Analysts believe that if there are big players like Bitcoin that tug the crypto market DeFi is also partially responsible for this. Let’s look into why.
2020 has been the year of cryptocurrencies. The unstable economy and the uncertainty regarding the value of the Dollar led people to look for alternative ways to acquire assets. Starting from individual miners or traders to institutional investors, people started shifting focus to the crypto market. Last year saw a major boom in the value of popular cryptocurrencies like Bitcoin, Ethereum and so on.
The ongoing coronavirus pandemic almost triggered the wild ride of accumulating crypto assets. The value of Bitcoin surpassed record highs. It peaked at $40,000 after running a marathon of price surge. Even with major corrections in between, the uptrend of these digital coins has not stopped.
DeFi Impacted 2020 Bitcoin Price Surge
The major hype of the blockchain industry is DeFI which is believed to have brought in a lot of dollars into the market. According to analysts, decentralized finance is the major reason for the overwhelming intrigue in the crypto market currently. The past few months that have seen an incredible surge in liquidity mining, decentralized exchanges and so on owe a lot to DeFi.
The duo of Bitcoin and DeFi has also gone through a lot these past few months. Earlier the surge in BTC prices was negatively linked with decentralized finance. However, that is not the case now. The scenario has turned within the past year, especially the latter part of 2020 when there was a surge in activities of already invested crypto assets rather than a rise in fresh investments. This almost clarified the clear impact of DeFi on the blockchain tech and Bitcoin. Some are also of the opinion that Bitcoin’s price surge is intricately related to the rise in the usage of DeFi platforms.