No Matter Volatility, Crypto Remains Record Breaking Investment Industry

According to the annual crypto review by the hailed by many crypto enthusiasts Statista, despite excessively volatile exchange rates and the ongoing discussion about the sustainability of the large blockchains and eco systems beyond Bitcoin and Ethereum, 2021 was certainly a very successful year for crypto investors. U.S.-based crypto holders alone were able to generate $47 billion from trading Bitcoin and other cryptos last year. The world's largest economies are also among those whose residents have benefited the most from the crypto boom.

With estimated profits of $8.2 billion, $5.8 billion, and $5.8 billion, respectively, countries like the United Kingdom, Germany, and Japan are still in a different league than the United States though. Chinese investors also made the top 5 with estimated annual gains of $5.1 billion despite harsh restrictions imposed by the new legislation enacted in April 2021: the People's Bank of China banned all trading in and mining of cryptocurrencies.

Russia on the other hand, which is currently still in 7th place with $4.3 billion in crypto profits, could bolster use of crypto due to the current sanctions. While at the time of writing CBR was still planning to ban trading with Bitcoin, Ethereum and other cryptocurrencies at the beginning of the year, the government wants to become more flexible in terms of choosing various means of payment going forward.

In Europe, little by little financial institutions and lawmakers became concerned about unrestricted use of crypto, suspecting such bad things as tax evasion and unlawful activities. According to a report by German platform Netzpolitik, the EU is mulling to ban Bitcoin mining and trading with corresponding currencies, also mentioning Bitcoin's enormous energy consumption.

According to the analysts at Chainalysis, it is almost impossible to precisely specify the profits generated by trading in cryptocurrencies for individual investors or wallets due to the decentralized nature of the blockchain. To bypass this, the transaction data of the observed crypto exchanges was analyzed to determine the estimated values, converted to U.S. dollars, and attributed as a percentage to the web traffic of the countries that accessed said crypto exchanges. According to the research, a total of around $163 billion in gains was generated from cryptocurrency trading in 2021, $130 billion more than in 2020.