2020 Was a Special Year in Bitcoin History, but 2021 Will Surpass All Your Expectations
The Bitcoin revolution will take everything in its path.
|Sylvain Saurel||Dec 31, 2020|| 2|
The year 2020 will remain a special year for the whole world. A pandemic on a scale not seen in decades hit the world at the beginning of March 2020. Within a few weeks, all countries around the world were affected by COVID-19, which originated in Wuhan, China in early December 2019.
In an attempt to limit the spread of this COVID-19 pandemic, most of the world's major economic powers decided to confine their citizens. These confinements have dealt an incredibly powerful and rapid blow to the global economy.
An economic crisis of a magnitude not seen in decades then began.
To limit the effects of this economic crisis, central banks and governments were quick to react as they did in 2008 during the previous major economic crisis. Within a few weeks, major central banks around the world decided to print out of thin air more than 10,000 billion dollars. The Fed alone exceeded $3,500 billion. The M2 Money Stock has now reached $19,299 billion by the end of 2020:
This represents an increase of $3,787 billion since the beginning of March 2020 or +25%.
A quarter of the U.S. dollars in circulation today have been issued since the beginning of March 2020. This is something quite incredible. Of course, the United States is not the only one to have done so. Because of the U.S. dollar's monopoly on the world, the United States exports its currency inflation all over the world.
The governments of the world's major economic powers have taken advantage of the aggressive monetary policies of their central banks to borrow more and more money. The U.S. public debt, for example, has increased by more than 4,000 billion dollars in 2020. It now exceeds $27.5 trillion.
Yet all this money has not really improved the situation for most people. The poorest are suffering more than ever, which will lead the United States to finance a new stimulus package in early 2021 amounting to $900 billion.
The United States will undoubtedly reach $30,000 billion in public debt in the year 2021. The public debt-to-GDP ratio in the United States is now around 130%:
While seeing a country exceed 100% under this ratio was an exception in the past, it has now become the norm in 2020. The Institute of International Finance (IIF) has recently published alarming figures indicating that global debt will reach $277 trillion by the end of this year 2020.
This represents an increase of $15T over the year 2020 and of $56T over the last four years. The most worrisome thing here is that the trend is accelerating since the increase was only ten times less than the previous period from 2012 to 2016.
Global debt is clearly out of control, and it is highly likely that when this coronavirus crisis is behind us, an even more dangerous enemy will be facing us: global debt. A debt crisis will occur sooner or later because the current situation is unsustainable.
This endless impression of fiat money by central banks, which favors the equally infinite growth of the public debts of the world's major economic powers, is the original sin that then induces the seven original great sins that will lead to the collapse of the current monetary and financial system.
More and more people have come to understand in 2020 that the current system could not last much longer. The IMF is even beginning to call for a Great Reset. A kind of Bretton Woods 2.0.
It must be said that the people can bear less and less to see the richest 1% benefiting from the injustice of the current system while the poorest 50% suffer martyrdom. The aggressive monetary policy of the Fed, for example, served only one purpose in 2020: to give birth to a real tech bubble in the stock market.
The S&P 500 and the Dow Jones have thus broken totally incredible records given the situation of the real economy. While Main Street was suffering, Wall Street was lining its pockets. In the summer of 2020, Apple became the first American company to surpass the $2,000 billion market cap mark.
Jeff Bezos became the first person to own a potential personal fortune of more than $200 billion in that same summer of 2020. And what about Tesla, whose market cap now stands at $650 billion. Tesla is now in the Top 10 of the world's most capitalized companies, while Elon Musk is the second richest man in the world with a fortune of over $150 billion.
All the money printed by the Fed has allowed the wealthiest Americans to see their fortunes increase by more than $1T in 2020. The drastic drop in the velocity of the M2 Money Stock has only confirmed this:
The people have never been able to benefit from the money printed to help them. And it wasn't the few dollars sent to eligible citizens via stimulus checks that really made a difference.
The great monetary inflation that accelerated in 2020 has highlighted more than ever a central need for the inhabitants of the Earth: to protect its wealth over time in a way that is resistant to censorship. This is how Bitcoin came to light in March 2020.
Bitcoin first came into negative attention during the liquidity crisis that gripped all liquid markets in March 2020. As the only truly free market in the world, Bitcoin was the most impacted market. Within a few hours, the Bitcoin price lost more than 50% of its value, hitting an annual low of $3.8K.
Many took the opportunity to announce the imminent death of Bitcoin, while Bitcoiners saw this as an incredible opportunity to accumulate more. As a result, the Bitcoin price rebounded sharply above $5K and then $6K. At the beginning of May 2020, a few days before its third Halving, Bitcoin had a price of around $9K.
A big debate was still raging in the community: was Bitcoin's third Halving already priced in?
As I explained at the time, such a monetary shock for the Bitcoin supply could not be anticipated. Some then doubted it in the weeks that followed when the Bitcoin price stagnated around $10K without showing its legendary volatility. Once again, one had to step back to see the bigger picture. Don't let the noise stop you from seeing the real signal that is the Bitcoin revolution.
The Bitcoin Revolution kept building on its fundamentals. Seeing a legendary investor like Paul Tudor Jones opting for Bitcoin instead of gold at the beginning of May 2020 was already an important first signal. Many refused to see that this would cause the beginning of a total change of mentality around Bitcoin afterward.
In the summer of 2020, things accelerated with the entry of a major company into the world of Bitcoin. On August 11, 2020, Michael J. Saylor announced that MicroStrategy was making Bitcoin its primary treasury reserve asset. This announcement was especially important since Michael J. Saylor was a former Bitcoin hater. At the end of 2013, he had announced that Bitcoin would die.
Michael J. Saylor humbly admitted that he was totally mistaken. After much research, Michael J. Saylor realized that Bitcoin’s success was now inevitable. Bitcoin is simply the best savings technology in the world. In the face of the great monetary inflation that we will continue to experience in the years to come, buying Bitcoin is a no-brainer.
Michael J. Saylor quickly became a Bitcoin Maximalist capable of spreading the good word about Bitcoin. He then continued to strengthen his position in Bitcoin to such an extent that MicroStrategy now has 70,470 BTC purchased for $1.125 billion. At the current price of Bitcoin at $28K, this is the equivalent of $2 billion. A nice capital gain of nearly 80% in a few months.
In the same vein, Square, which benefits greatly from Bitcoin with its CashApp application, did the same with a more modest investment of $50 million worth of Bitcoin.
Square made this decision just at the very beginning of the incredible upward rally that Bitcoin was going to experience at the end of the year 2020. Within a few weeks, the Bitcoin price was going to overcome all resistance, especially the $20K that had become a major psychological barrier.
The entry of PayPal into the Bitcoin world at the beginning of November 2020 obviously accentuated this bullish rally. If buying Bitcoin via PayPal is a bad idea, since you won't be in control of the private keys of your BTC, the fact remains that it gives Bitcoin credibility to the general public.
The general public needs this type of signal to be reassured about Bitcoin while the powerful people at the head of the current monetary and financial system continue to denigrate it by propagating lies about it. This is obviously an admission of weakness. These powerful people are afraid of being disrupted by Bitcoin, which is a total paradigm shift that aims to return power to the people in matters of money.
Throughout this bull market rally at the end of 2020, we have seen a growing demand for Bitcoin from institutional investors. This demand is so strong that we are witnessing a real liquidity crisis. The number of BTC issued each day, which is currently 900, is not enough to satisfy the appetite of institutional investors.
Nobody wants to sell their BTC anymore. Everyone understands that Bitcoin is a monetary revolution that will change the world of the future for the better. Owning Bitcoin will make a big difference in the future. In fact, you have no reason to sell your BTC.
This ever-increasing demand is in contrast to the Bitcoin supply which is hard-capped at 21 million units no matter what. As the law of supply and demand teaches us, the Bitcoin price can only rise sharply as a result. At the time of writing, the Bitcoin price is $28.8K, an increase of +660% since the low point reached in March 2020 at $3.8K.
When I was talking about a sale season for Bitcoin in March 2020, some people laughed at me. Not Bitcoiners of course. We've been able to accumulate more BTC at a price that seems indecent today given the incredible value of Bitcoin.
If Bitcoin has been the best performing asset of the past decade, all indications are that it will continue to be the best performing asset for the next decade. Bitcoin price has the potential to show a 25x gain by 2030 as the Winklevoss twins explained at the end of November 2020:
Those who do not yet own BTC are people who have not yet understood the incredible liberating potential of Bitcoin. If you really understand Bitcoin, there's no way you won't buy Bitcoin next. It's such a no-brainer. Faced with a fiat system that is doomed to collapse, Bitcoin is your best weapon. The best way to protect your hard-earned money.
What's the point of working hard to keep your money in a fiat currency that keeps falling apart?
You have no interest in doing this since your money keeps losing value over time. The U.S. dollar and other fiat currencies were designed to be spent. Bitcoin was designed to give as many people as possible access to the best savings technology in the world. It is up to you to take advantage of it to really take control of your money future.
If Bitcoin has never been stopped until now, it is precise because Bitcoin is truly unstoppable. It is impossible to stop a revolution, without a leader, that is supported by the people. Those who still doubt it will sooner or later find out the hard way.
Buying Bitcoin today at $28K is much less risky than buying it when it was only $28. It's up to you to understand this and get on board the Bitcoin revolution train.
This year 2020 has been a very special year for Bitcoin. However, my feeling is that this is nothing compared to what Bitcoin will be in 2021. The bull rally we have just experienced is nothing compared to what will await Bitcoin in 2021. The Bitcoin price will reach $100K by the end of 2021. This is my belief and that of all Bitcoiners.
The Bitcoin price is $28K today while retail investors have not yet entered the dance. Expect them to flock to the Bitcoin world in 2020 as the Bitcoin price rises sharply. This is how the general public thinks: nobody wants to buy Bitcoin at $4K, but everyone is rushing to buy it by FOMO effect when its price exceeds $20K.
Bitcoin's dominance in the cryptocurrency market is again at 70%. You can expect this to increase even more in 2021. In the long run, only Bitcoin really matters. Those who still doubt it will understand this as time goes by. Some will lose a lot of money by buying Sh*tcoins.
My advice is always the same: buy Bitcoin, and don't lose your money by buying Sh*tcoins that only aim to make their founders rich.
In the upcoming years, more and more hedge funds will come to buy Bitcoin, American professional sports stars will get paid in BTC directly, American banks will embrace the Bitcoin revolution by offering it to their users just like PayPal does, additional large companies will make Bitcoin their reserve asset.
It's only a matter of time before Amazon or Apple will come to buy Bitcoin or get involved in this world that will eat everything in its path. In the face of such a monetary revolution, it is better to be in it than out of it.
Some will tell you about the danger of the Central Bank Digital Currencies (CBDC) or Facebook's Libra, now Diem. Don't listen to these dissonant voices that don't understand that only Bitcoin has the power to liberate the people. These CBDC simply aim to control citizens even more, while Facebook's Diem will be just another Sh*tcoin based on a system aiming to compete against PayPal.
In 2021, Bitcoin will remain unique thanks to its monetary attributes. Its technology will remain perfect to give credibility to its monetary attributes. Those who choose to become Bitcoin HODLers will probably be called lucky when they will simply be pragmatic people.
It is up to you to decide if you want this year 2021 to be phenomenal for you. If you want it to be, you know what you have to do: get on board of the Bitcoin revolution train. If you make that choice, remember to follow the Ten Commandments of Bitcoin to the letter.
See you at the end of 2021 with a Bitcoin around $100K. And may a higher price since this price seems to be becoming a conservative assumption now.
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