Not all industries were lucky enough to stay afloat during the year 2021, but Cryptocurrencies had a banner year in 2021. According to PitchBook Data, the overall market worth of cryptocurrencies hit $3 trillion in 2021.
In 2021, venture capital funds from around the world invested roughly $30 billion in cryptocurrencies, resulting in an increase in market capitalization (till December 15). This was more than the sum of all prior investments in this decade-old technology during the preceding years. 2018 was the second-largest year for cryptocurrency investment, with $8 billion spent in digital currency.
For the little more than a decade-old technology, venture capital investors have put approximately $30 billion into it, which is more than all preceding years combined. According to transaction statistics gathered by PitchBook Data, this is nearly triple the previous high of about $8 billion in 2018 or the year after Bitcoin’s more than 1,300 per cent breakthrough gain.
The Little Details
When Spencer Bogart, a general partner at Blockchain Capital was asked about this, he said “Things have changed a lot and everyone has moved way beyond just digital gold. There are so many subtypes of NFTs like art, finance, commerce. There are so many options that it makes the investors wonder if they even have enough exposure for such things”.
About $7.2 billion of the $30 billion investment in cryptocurrencies in 2021 was raised by venture capitalists in the United States. FTX, a crypto derivatives exchange, raised $1 billion in funding; Custodian New York Digital Investment Group raised $1 billion; Forte, a blockchain integration tool provider, closed a $725 million round; MoonPay raised $555 million.
Sustaining Through Everything
Despite the negative trend after China’s governmental crackdown on virtual currency, crypto investments have skyrocketed. The advent of specialist industries like NFTs, according to crypto experts, has resulted in a significant increase in investment.
According to a poll conducted in September, crypto investors invested an average of $263 into accounts devoted to cryptocurrencies, which is more than the average $250 they put into standard brokerage accounts.
Meanwhile, cryptocurrency investments have risen sharply in India. While no exact data are available, industry insiders estimate that the country has 15-20 million crypto investors with a total crypto holding of roughly Rs 400 billion. India ranks 11th out of 154 countries in terms of cryptocurrency usage, according to a survey published by blockchain data platform Chainalysis.
Despite rumours that the Indian government intends to outlaw private cryptocurrencies and enact legislation to regulate digital money, this remains the case. Crypto investments, according to some analysts, spiked in the aftermath of the COVID-19 outbreak, when traditional assets like currencies, bonds, and shares became volatile.