An unprecedented phenomenon has unfolded after crypto climb at the end of 2020 and at the start of 2021. Simplex’s data took note of this development and suggests that the phenomenon has increased profit earning and conversion into fiat.
Netanel Kabala, Simplex’s Co-Founder, said that since 2020 Bitcoin’s news coverage at the international level has enabled new investors to join Bitcoin’s investment bandwagon. Resultantly, investors from individual and institutional quarters came in which in return increased outflows significantly. As per data, at least 43% of the Bitcoin sale proceedings were off ramped by December 2020.
Meanwhile, Google also revealed that Bitcoin became one of the prominent Google Trends wherein searches relating to Bitcoin have increased threefold. However, the giant fund managers such as Blackrock and Grayscale Bitcoin Trust also played vital roles in nurturing awareness regarding Bitcoin. Similarly, the ever-growing crypto fungibility has also enabled crypto users to purchase, dispose of and utilize crypto through PayPal and Visa.
But there were many who disbelieved in Bitcoin’s rally and suggested that this was more akin to a bubble. However, the majority amongst the crypto industry took note of this development as the herald of the future. This herald can easily be seen in the form of altcoins.
Simplex’s data reveals that when Bitcoin’s value surged in 2020, similarly the average purchase rate of altcoins on daily basis increased substantially. According to data average daily purchases increased by about 65%. In addition, the major chunk of this increased daily volume for altcoins was acquired by mostly new investors. It was estimated that new users for altcoins increased by about 20% which was relatively on a much higher side than in the past. This then resulted in the rapid growth of newbie investors who all became part of the ecosystem.
The first exchange to notice this development was Poloniex. Karen McHenry, Product Director at Poloniex accredited this change for providing vast accessibility to the system, particularly with the buy option offered by Poloniex.
Karen also stated that incorporating selling options at Poloniex brought about a constructive impact on Poloniex’sdaily trading volumes as well.
McHenry also commented that if Bitcoin continues to gain momentum then the profits generated through Bitcoin’s sale would go into altcoins.
