Fidelity Digital Assets — the crypto wing of Fidelity Investments, which has $4.2 trillion in assets under management — shared its “two sats” on the future of the digital assets space. The most important findings concerned the behavior of the miners and Bitcoin (BTC) network acceptance.
In the annual report Posted last week, the group shared some insights into the world of BTC mining:
“Since bitcoin miners have the greatest financial incentive to best assess BTC’s adoption and value (…), the current bitcoin cycle is far from over and these miners are investing for the long term.”
The report noted that the recovery in hash rate in 2021 was “really amazing,” especially given the world’s second-largest economy China will ban bitcoin in 2021. The rebound in hash rate since the ban thanks to the “further spread of BTC hash power around the world” showed that miners are looking for long-term profits.
The statements were consistent with the miners’ recent sales performance. Key on-chain metrics indicate Bitcoin miners in “fixed” BTC accumulation mode, since miners show no desire to sell.
Related: Fidelity Manager Says Bitcoin Is “Technically Oversold” Making $40,000 A “Crucial Support”
When it came to filling entire countries with oranges, Fidelity made some interesting predictions that more nation states would accept BTC as legal tender:
“There is a very high-stakes game theory at play here that the countries that grab some bitcoin today will be competitively better off than their peers as bitcoin adoption increases. We would therefore not be surprised if other sovereign nation states acquired Bitcoin in 2022 and perhaps even a central bank made an acquisition.”
Your comments come as a former MP from Tonga suggested the country could adopt BTC end of 2022.
Essentially, more regulation and better products will open up the crypto space and “bring a larger chunk of the hundreds of trillions of traditional assets into the digital asset ecosystem.” Combined with miner hodling, this could extend the cycle and propel BTC to new highs.
