2021 seemed like the year cryptocurrency grew up. Bitcoin broke out of its three-year bear market in November 2020, going on a massive rally vaulting it into mainstream public consciousness.
It was a great year for enthusiasts for sure.
We saw Bitcoin become legal tender in El Salvador, and other countries[1] begin walking in President Bukele’s footsteps. Lightning Network began bringing first-world financial services to hundreds of millions of unbanked citizens.
Wall Street got in the bitcoin game in a big way, with multiple new ETFs, funds and IPOs. Many of Bitcoin’s enemies flipped to become allies. Some remained stalking horses for the existing system, like SEC Chairman Gary Gensler[2] and U.S. Treasury Secretary Janet Yellen.[3]
Despite mounting pressure Bitcoin went from fringe technology to the vanguard of the technology investor space. Decentralized Finance (DeFi) projects, ill-intentioned or not, proliferated like mushrooms after a rain. The rate of code evolution is mind-boggling.
Capital inflow to cryptocurrency grew as China forced out mining and sent that capacity to the U.S. Global economic disruptions thanks to COVID-19 forced radical rethinking of energy policy. Bitcoin was finally exposed as uneconomic subsidized electricity rates in China, for example.
So, given this immense growth in the public mindshare in 2021, the title seems a moot question at first blush. In many ways Bitcoin has already proven itself.
But 2021 was just the warm-up act for the real economic showdown in 2022 between the Great Powers. The old system is clearly failing. It is the way it fails which will inform geopolitical tensions worldwide. These will take center stage as the titans of that old financial and political order fight for dominance over a shrinking pile of capital.
In the middle, bitcoin stands ready to perform the
