1.Notwithstanding the possibility of extreme (and for this asset class, ordinary) volatility, prices for digital assets will end the year higher than they began, and possibly significantly higher. This will be fueled by increased institutional adoption and the snowball effect of individual investors, many spurred by FOMO.

2.Bitcoin’s share of market will rise, as lots of Layer 1 coins will disappear. But bitcoin will not be the best-performing digital asset.

3.For the financial services industry – financial advisors and their firms as well as asset managers (from mutual funds to hedge funds to pension funds and endowments to corporate balance sheets and family offices) – reputational risk will shift from “why did you invest in that” to “why didn’t you invest in that.” There will be significant window dressing at each quarter-end as investment managers strive to hide their failure to own digital assets.

4.Federal acquiescence to (if not outright approval of) digital assets will continue, as evidenced by 2020’s regulatory proposals (stablecoins and prohibition of anonymous wallets, for examples) and regulation by enforcement (SEC’s action against Ripple, for example). The more they regulate, the more legitimate digital assets become, fostering greater adoption. And as the number of investors rises, and the amount of capital invested increases, the harder it will be for the federal government to outlaw it. (Already, 20 million+ people own bitcoin, including 6% of the U.S. population, with $350 billion invested.) Truly, bitcoin is here to stay.

5.Further progress in the development of CBDCs will continue. By 2025, most countries will have one in use.

6.We will see at least one centralized company launch a decentralized, user-owned/operated crypto-network where the crypto-network has legitimate checks and balances over the company’s actions.

7.Some of the biggest IPOs of the year will involve crypto companies.

8.Top talent from law, engineering and financial services will leave their positions (and often, careers) to take (or create) new ones in the blockchain and digital asset space. It’ll snowball to conspicuous levels.

9.Frauds and scams will increase commensurate with the price of bitcoin.

10.The SEC will approve a bitcoin ETF. That will cause the GBTC, ETHE and BITW premiums to evaporate.

11.The first bitcoin ETF will see deposits exceed $5 billion within two weeks of debut.

12.As soon as the SEC approves a bitcoin ETF, dozens more filings will be made – not just of copycats but for other coins and strategies (diversified funds, long/short, leveraged and infrastructure). It will spur a new exponential growth curve for the price of bitcoin and other digital assets followed, likely, by another crash.

13.Tokenization will skyrocket. Assets of all types – from tangibles (real estate and collectibles) to intangibles (royalties from recording artists and performance contracts from professional athletes/teams and tv/radio/movie/theater artists) – will gain huge traction, setting the stage for explosion in the 2020s.

14.Loyalty programs will begin to award points in bitcoin.

15.Regulators around the world will freak out over Diem and Novi, certainly slowing, probably stalling and possibly stopping their deployment.

16.Someone will finally and succinctly explain what the hell DeFi is. While everyone argues about it, regulators, legislators and courts will reject or ignore it. But marketers and the media will love it.

17.Several Fortune 500 companies will add bitcoin to their cash reserves or investment portfolios.

18.The Biden Administration will prove to be very friendly to digital assets and blockchain, ushering in a new wave of investment in this space (and not merely purchases of bitcoin itself).

19.There will be some shuffling in the Bitwise 10 Crypto Index, but #1 and #2 will remain #1 and #2.

20.As more investment funds come onto the market, prices – reminiscent of mutual funds back in the 1980s – will fall. It won’t take long for prices to be comparable to today’s ETFs though that’s unlikely to occur in 2021. Meanwhile, investors will continue to tolerate higher fees as the price of admission to the digital asset world.

21.Thousands of financial advisors will obtain their Certificate in Blockchain and Digital Assets® from www.dacfp.com to enable them to better serve their clients in these new asset classes.