In the past year, it was mainly due to the global outbreak of the deadly new crown virus, which paralyzed the economies of various countries and killed millions of people. But for those in the crypto and blockchain communities, 2020 finally shows the true potential of the technology. This article lists the most important events in the encryption field in 2020, which will have a lasting impact on the application of blockchain and digital currency.
source: cointelegraph
Commentary on the runaway: In the past year, it was mainly due to the global outbreak of the deadly new crown virus, which paralyzed the economies of various countries and caused millions of deaths. But for those in the crypto and blockchain communities, 2020 has finally demonstrated the true potential of the technology. This article lists the most important events in the encryption field in 2020, which will have a lasting impact on the application of blockchain and digital currency.
The past year has witnessed numerous ups and downs, mainly due to the global outbreak of the deadly new crown virus, which has led to economic paralysis in various countries and millions of deaths. But for those in the crypto and blockchain communities, 2020 finally shows the true potential of the technology.
It can be said that there were more developments last year that had a long-term positive impact on the industry than in the entire history of distributed ledger technology and Bitcoin (BTC). The following are five major developments in the field of decentralized technology last year. These developments will leave a lasting memory and a strong legacy in the coming years.
Bitcoin prices have repeatedly hit new highs
Bitcoin price not only broke through the $20,000 price mark originally set during the 2017-2018 bull market. First, $20,000 was broken. Soon after, $30,000 was also broken. And now, even the $35,000 mark has been broken.
Those seemingly crazy predictions that the price of Bitcoin will reach $45,000 by the end of 2021 may not be that far away. More importantly, the infamous stock convection model developed by crypto trader PlanB predicts the price of Bitcoin at $100,000.
So yes, prices will rise, but they will also fall. This has happened before, and it may happen again, right? However, in theory, many things have changed, especially the general perception of Bitcoin. This is evident from the shift in demand from retail investors to institutional investors.
Bitcoin has ushered in high-profile investment from many institutions. They have joined the industry for their various needs, from companies like Microstrategy that choose to hold BTC as a reserve, to the rise of crypto investment funds like Bitwise and Grayscale-who I don't know which individuals are investing through these. We only know that they are willing to invest billions in the crypto field. Then in late October, the real big news came...
PayPal launches encrypted payment option
PayPal is a company that had similar basic beliefs to Bitcoin itself when it was first established. It not only announced its entry into the crypto field, but actually entered the crypto field in 2020, at least in the United States. In addition, according to reports, PayPal is now one of the biggest buyers of Bitcoin because the company is building reserves to meet customer needs.
To sum up this development in one word, it is "adoption." Now, about 28 million merchants and more than 361 million users around the world will have access to the "nascent" version that owns and uses encryption technology. According to the company, it is the custodian, essentially just selling its share of BTC. In doing so, it does not follow the traditional way of people owning cryptocurrency, which is good.
For ordinary users, encryption technology is too difficult to understand—all hot and cold wallets, passwords, 12-character mnemonics, etc. PayPal is providing an easy-to-use way to enter the ecosystem, and once this happens, some people may really discover more about how to use this technology in its entirety.
Bitcoin reward halved
The Bitcoin halving is hailed as a major decisive moment for the crypto industry. It happened, but in fact nothing happened at the time. Various commentators predict that the price of BTC will shrink and then collapse, while other commentators foresee a decline in the network's hash rate. Although these things did happen to a certain extent, they were far less dramatic than expected. This is a very good thing.
Bitcoin mining reward halving is an event that occurs about once every four years, and the number of BTC obtained by miners who discover a block will be halved. This is a rigid rule incorporated into the blockchain, limiting the supply to 21 million BTC, and mimicking the limited supply of gold.
In the end, Bitcoin's price and fundamentals were barely affected, which led some people to believe that the industry has reached a certain level of maturity. Perhaps this flexibility is what ultimately caused some of the largest companies, economists and investors to reconsider their overall position on cryptocurrencies. As the year passed, the fact that the supply of Bitcoin was running out became more apparent.
Coinbase IPO
It has become a fashion for companies to go public, so we are very happy to see some crypto companies, such as Coinbase, have also joined the ranks. Since the company adopts an overall regulatory open approach, such a move will come soon, which is expected by half of the people, apparently to reassure the US regulators when the time is right.
This essentially means that traditional investors will be able to deposit millions of dollars in Coinbase equity. In fact, according to Messari, this figure is as high as 28 billion US dollars. The listing draft is also carefully selected in the context of the jump in the price of top cryptocurrencies, which is expected to bring benefits to the exchange, because it will undoubtedly face strict scrutiny by the Securities and Exchange Commission.
In the end, Coinbase can shine light into a dark alley, leading to large-scale adoption by investors and users. Other so-called "unicorns" may follow its example in 2021, so to some extent, Coinbase is crane its neck. But if they are approved for an initial public offering and become the first truly large crypto company, they may be rewarded.
Ethereum and DeFi
Bitcoin has investors and Ethereum has users. The latter will undoubtedly come forward in 2020 to make the decentralized finance boom a reality and find use cases for those decentralized applications that are known as game-changing.
Before July, everything was calm, when a company namedCompoundThe highly anticipated project announced the launch of its own token COMP. Facts proved that it was immediately welcomed, listed on high-profile exchanges, and established a new trend in DeFi.
The basic methodology behind Compound is simple. The platform serves as a decentralized lending protocol to pay interest to users who add their cryptocurrency to the pool. However, once the funds are added to the pool, the platform will issue the same amount of cToken, which can be used as collateral for the loan, which means that any token can be used twice.
As the price of COMP began to dive, it didn't take long for other projects to seize this new trend and begin to launch competitive agreements or projects that supported the ecosystem. After just over a month,Yearn.financial was launched and pushed the yield farm phenomenon to a whole new level.
Subsequently, the decentralized exchangeUniswapIt also joined this action. It opened its own capital pool. With its open listing policy, countless DeFi projects flocked to it to list its tokens on the exchange. However, it also uses automated market makers (BancorAn idea developed in 2017) had an impact. 2020 is the year when automatic market makers really take off, by pushing users to trade with tokens built on the Ethereum blockchain. This ultimately brought thousands of active users to the Ethereum network.
More importantly, the Ethereum 2.0 upgrade finally started after several delays. The combination of ETH 2.0, the recent renewed interest in altcoins, and the DeFi boom has undoubtedly renewed interest in Ethereum and the Ethereum (ETH) token itself, pushing its price to far exceed US$1,200. A level not seen in two years, and close to a historical high of around $1450. Now, just seven days after the new year, some people are sure that $2,000 will come quite soon.