Bitcoin: How much you could have made by investing £1,000 in crypto this year
Bitcoin 'not seen as a currency for transactions' says expert
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Bitcoin has risen astronomically since its invention over a decade ago, in both popularity and value. Whilst people who jumped on board early on in the cryptocurrency’s life were able to make huge profits, there has still been potential to make money by investing in Bitcoin in 2021.
In fact, a purchase worth £1,000 on January 1, 2021, at a price of £21,159.80 per coin would now be worth £1,567.86.
That would mean a profit of £567.86 from an investment of just £1,000, which equates to a profit margin of 56.79 percent.
The price of Bitcoin has fluctuated considerably on a month-to-month basis throughout 2021, with many highs and lows.
Between January 1 and February 1, the price of one Bitcoin increased to £24,246.97, an increase of 14.59 percent.
The biggest increase from one month to the next came between February and March, with the price of Bitcoin skyrocketing to £35,525.70 on March 1.
That represents a whopping 46.52 percent increase from February.
Bitcoin’s value continued to surge entering April, hitting £42,361.03 on the first of the month.
By hitting £45,695.21 on April 16, Bitcoin achieved its highest ever value.
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Among the possible reasons for Bitcoin’s sharp uptick during this period was Elon Musk and Tesla announcing their investment into Bitcoin as well as accepting it as payment.
However, the price of the digital currency began to fall in the months ahead, starting with a modest decrease down to £41,335.27 on May 1.
Bitcoin lost over a third of its value between May and June, as the price of one coin plummeted down to £26,639.08
And the decline did not stop there, as the price Bitcoin fell to £25,143.12 between the start of June and July.
In the midst of that downward spiral, Bitcoin hit its lowest price point of 2021, falling to £21,358.16 on July 21.
In the same way that Musk may have helped kickstart a strengthening in the value of Bitcoin, he is also suspected to have played a role in its decline.
This was due to suggestions were made that Tesla had sold, or planned to sell, its holdings of Bitcoin.
Combine that with the news of the Chinese government setting new regulations to crack down on crypto, and some of the potential reasons for Bitcoin’s decline become clear.
However, the cryptocurrency managed to rebound from that point, climbing back to £33,175.54 on August 1, Bitcoin’s highest price to open a month since May.
These regular and dramatic changes illustrate the volatile nature of Bitcoin and cryptocurrencies in general, and the potential dangers of heavily investing in these assets.
Bitcoin is the world’s most popular cryptocurrency, with a market cap of £629.6billion.
The first of its kind, Bitcoin was invented in 2008 by an unknown person or group of people known as Satoshi Nakamoto, before coming into use the following year.
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