Bitcoin (BTC) ended 2021 at an average price of $47,400, as Ray Dalio noted that BTC has “proven itself.” Meanwhile, MicroStrategy (Nasdaq: MSTR) continued to acquire more of the leading cryptocurrency to strengthen its corporate treasury, the team at Blockstream noted in a recent market recap report.
The update from Blockstream also mentioned that Southeast Asia has recently seen a cryptocurrency mining boom. Notably, Marathon acquired $900M of digital currency miners, and Morgan Stanley funds added to their GBTC position in 2021.
As mentioned in the report, Bitcoin was on pace to end the last week of 2021 “modestly lower and almost spot on the full-year average price of $47,400 (up 4.3x from last year’s full-year average price of $11,126).”
Meanwhile, equity markets appeared set to end the last week of 2021 “higher and will likely close out the year at or near all-time highs.” 2021 was “a blowout year for equities with the S&P recording a new record high every month this year,” the report added.
Today’s (dated Dec 31, 2021) Bitcoin options expiry “was followed by a ~ 3% price pop, recovering some ground lost earlier in the week.”
As stated in a report from Blockstream, the removal of “both the China exchange ban and the normal dump into options expiry probably sets us up pretty nicely for the first week of 2022.” Analysts at Blockstream also wondered about “how much of the downward price trend of the last two months has been driven by the forced closure of Chinese exchange accounts.”
In December 2021, Bobby Lee noted that Chinese exchanges like Huobi and OKEx have “until the end of December to close down Chinese user accounts.”
Blockstream analysts think this “probably explains why we’ve seen Bitcoin typically trade weaker over Asia hours vs US and European hours.”
According to the firm, it’s also “a potential reason for optimism going forward as the Chinese exchange overhang will be cleared from the end of this month.”
While sharing other updates, the report noted that China’s September Bitcoin mining ban “has reportedly driven a mining boom in South East Asia.”
It should be interesting to see governments across the globe from New York and Miami, to Texas, El Salvador, and now Thailand “turning to Bitcoin as a growth driver,” the report added.
As noted in the report:
“Beijing’s crackdown forced the largest and best-resourced companies to pack up and move operations to North America, Malaysia, Russia, and Kazakhstan. The smaller players reportedly cut losses and dumped hardware to retail and corporate miners in places like Thailand.”
In neighboring Laos, authorities have licensed six local firms as legal miners and in November, it was reported that the government of Laos “expects Bitcoin mining to generate $190M in revenue next year, almost 7% of the country’s total projected domestic revenue in 2022.”
As stated in the report, 2021 was a year “marked by significant institutional participation and the very beginning of sovereign adoption.”
The report continued:
“There’s a lot to look forward to in 2022, including US spot ETFs, further decentralization of Bitcoin hash rate, more Bitcoin company IPOs, broader sovereign adoption, increased institutional participation, Lightning Network growth, and more STOs on the Liquid Network.”
As mentioned in the update, Ray Dalio had said during a podcast appearance with Lex Fridman that:
“[Bitcoin] has proven itself. It has not been hacked, it has operated in an amazing way over that 11 years to be probably the most exciting topic among a lot of people. It has been used and is now obtained the status of having imputed value.”
The report further noted that Marathon announced the purchase of “an additional 78,000 Antminer S-19 XP Miners from Bitmain.”
The company “expects its operations to grow to nearly 200K bitcoin miners producing ~23.3 EH/s by early 2023.” The update from Blockstream also mentioned that this should “represent a 600% increase from the current production levels.”
The report also noted that crypto miners are “guiding for a massive capacity expansion in 2022, but it’s unclear to what degree this will continue to be bottlenecked at the foundry level.”
The Blockstream market update further noted that Michael Saylor “backed up the truck again…loading up another 1,914 BTC for a total of ~ $94.2M.” In 3Q21 alone, MicroStrategy “bought more than 9,000 BTC.” MSTR’s total stash now “totals 124,391 BTC acquired at an average price of $30,196.”
For more details on this update, check here.