• Bitcoin’s price could target anywhere from $36,000 to beyond $300,000.
• Ethereum DeFi tokens could show better a performance than “low-cap cryptocurrencies”.

As the end of 2020 approaches, the crypto market seems to be on a boom and a bullish trajectory that is likely to continue into 2021. A wave of institutional adoption and the expansion of the money supply in the world’s major economies are just two of the causes that have dominated the pro-Bitcoin and crypto narrative. The coming year promises even more gains and milestones for the nascent space.

According to a post by the exchange Bybit, 11 bullish narratives will “dominate” the crypto market in 2021. In the scenario outlined in the post, Bitcoin will have massive profits. The price of the benchmark cryptocurrency could rise to a range from $36,000 to $300,000, according to different predictions. This year, Bitcoin has left any asset class behind.

This highest prediction for 2021 was made by Citibank in a publication that was very well-received and was considered a sign of the positive change of opinion that institutional investors have had during 2020 towards Bitcoin.

The bank’s prediction is more bullish than the one proposed by the creator of the Stock to Flow model for Bitcoin, Plan B, which puts BTC’s price at $288,000 by the end of 2021. Citibank’s prediction is higher than Kraken’s and Bloomberg’s that put Bitcoin’s price at $36,000 and $170,000 respectively.

In addition to the above, Bitcoin’s fundamentals are equally bullish. The dominance of the benchmark cryptocurrency is approaching new highs of about 70%. In 2021, BTC’s dominance could continue to increase if investors decide to move their funds from assets like XRP, due to regulatory uncertainty. Bybit also predicts a record level of regulatory activity and possible increased government involvement in 2021.

On the other hand, the derivatives market has seen a significant maturation. As an indicator of the growing institutional participation, the daily trading volume of Bitcoin options has reached $1 billion for the first time during December, as the following graph shows.

Grayscale’s Bitcoin fund will continue to be one of the largest buyers of Bitcoin, according to Bybit’s prediction, through 2021. Grayscale has absorbed about 3% of the total Bitcoin supply by 2020. However, the possible approval of a Bitcoin ETF could bring new players into the picture.

Data from Bitcoin Treasuries indicate that institutions have a total of 5.48% of the Bitcoin supply or 1,151,618 BTC. MicroStrategy, led by Bitcoin bull Michael Saylor, maintains its position as the company with most Bitcoin with 70,470. In 2021, other companies may adopt MicroStrategy’s strategy and make BTC their treasured reserve asset.

Ethereum DeFi grows and stablecoins emerge

The DeFi sector at Ethereum has had parabolic growth in the second half of this year. Unlike the comparisons made by some experts, the so-called “blue chips” show a positive performance that indicates that decentralized finance protocols will continue to play a key role in the near future, unlike ICOs after the 2017 bull run.

The migration to second layer protocols to increase scalability in the Ethereum network will also be a key factor in maintaining this. Finally, stablecoins will continue their “meteoric rise”. According to Nic Carter, part of the Castle Island Ventures team, the market capitalization of stablecoins could exceed $50 billion in 2021, as the following graph indicates.

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