Bitcoin is making serious waves at the end of 2020, reaching all-time high levels in the same week that DBS went live with its crypto exchange and Hong Kong cleared the first-ever licensed digital asset service provider. 

As of publishing, Bitcoin is nearing $22,000 and continuously breaking new records after first revisiting the 2017-high of around $20,000 in November. 

And as institutional investors continue piling in – most recently, American insurance giant MassMutual added $100 million of investments into Bitcoin – major cryptocurrencies are increasingly gaining mainstream adoption, most notably in the high tech region of Asia.

Asian Adoption

In addition to OSL’s launch in Hong Kong and DBS’s launch in Singapore – a rapidly emerging crypto leader worldwide – there are players in other markets that are rapidly making inroads into the nascent asset class.

Japan, another serious contender, is also accelerating its efforts with local financial giant SBI taking the lead. SBI has made a series of crypto moves recently including a planned 2022 launch of a digital exchange with Switzerland’s SIX, a partnership with Ripple and, most recently, the acquisition of U.K.-based cryptocurrency trading firm B2C2.

The region is also home to South Korea, one of the major initial adopters, and India – since its central bank lifted a crypto ban earlier this year, volumes have surged 87 and the country has surpassed China several days ago as the leader in peer-to-peer trading volume, according to Arcane Research. 

CBDC Boost

Decentralized currencies aside, the region is also a leader in developing central banking digital currencies (CBDC), most notably in China where the digital yuan continues to undergo testing, most recently through trial retail usage via e-commerce platform JD.com.

While some see CBDCs will act as direct competitors to cryptocurrencies, other onlookers believe that the growth of the former will further also drive the adoption of the latter.

«CBDCs will significantly enhance the interoperability of cryptocurrencies,» said Oki Matsumoto head of Monex Group, one of the largest crypto exchanges in Japan, which itself is simultaneously developing its own CBDC. «It would make the cryptocurrency market more lively.» 

Globally Diversified Drive

While various Asian markets are attempting to gain a first-mover advantage, the trend is global and there is diversity not only in the participants involved but also the reasons to adopt cryptocurrencies. 

Not unlike Hong Kong and Singapore, there are other developed markets trying to gain first-mover advantage such as Switzerland where crypto banks like Sygnum or Bitcoin Suisse are considering initial public offerings via tokenized shares.

But elsewhere, the real functions of cryptocurrencies and their viability as digital safe havens are being put to the test. Iran, for example, has allowed national imports to be funded by cryptocurrencies to taking advantage of decentralization and anonymity to dodge sanctions. On an even gloomier note, Venezuela is suffering from runaway hyperinflation – nearly 54 million percent between 2016 and April 2019, according to IMF estimates – and retailers such as Pizza Hut began accepting crypto as payment last month.

More ATHs

For those seeking to adopt not as a desperate measure but for asset diversification – and a bit of upside – the outlook is bright, according to global banks.

Following MassMutual’s investment, analysts from J.P. Morgan, one of the earliest crypto bears, predicted that another $600 billion of new money could enter the Bitcoin market. In a note leaked note on Twitter last month, Citi managing director Tom Fitzpatrick said the price of a Bitcoin could exceed $318,000, calling it the «new gold», driven by more potential monetary easing and debasement from the U.S. dollar. 

«[Cryptocurrency adoption is] absolutely inevitable,» said Bill Winters, CEO of Standard Chartered during the annual Singapore fintech festival on the same week the bank entered a tie-up with Northern Trust to launch crypto custody services. «I think there is absolutely a role for central bank digital currencies as well as non-central bank-sponsored digital currencies».