Crypto: The highlights of 2021 and what to expect in 2022 Crypto: The highlights of 2021 and what to expect in 2022 Crypto: The highlights of 2021 and what to expect in 2022

Crypto: The highlights of 2021 and what to expect in 2022

Cryptocurrencies 8 minutes to read
Mads Eberhardt

Cryptocurrency Analyst

Summary:  On the first weekday of the new year, we are looking back at crypto market in 2021 but also portraying what we expect will happen in 2022 in the volatile crypto industry.

Without any doubt, 2021 was a year for the books, in which the total market capitalization for the crypto market increased from around $800bn to $2.2trn. However, 2021 was not only exciting in terms of price actions, as there were many epoch-making events and trends throughout the year. In this article, we zoom in on 5 highlights last year, and 5 elements to watch out for in 2022.


NFTs: We cannot talk about 2021 without mentioning non-fungible tokens, known as NFTs. It has arguably been the crypto trend of the year. The trend, though, has been more speculative than the crypto market itself. However, it is only a matter of time before we see more use-cases of NFTs, such as music streaming.

Coinbase IPO: This is in our opinion the single largest event of the year, and acts as a sort of point of no return in terms of regulation and perceived market seriousness from the outside. The Coinbase listing emphasized an industry that first of all should not be ignored, and secondly, but more importantly, cannot anymore be ignored.

Stablecoins: The supply of stablecoins increased from $29bn to $151bn, an increase of 421%. Stablecoins are the backbone of the crypto economy and decentralized finance. The significant increase of stablecoins shows a growing interest in these products.

Regulation: Surprisingly there were solely a few surprises in terms of regulation namely the US infrastructure bill, El Salvador making Bitcoin legal tender, and China making crypto illegal. Besides that, no major surprises, which should not shock any cryptocurrency advocate gradually being used to the most.

VC in crypto: Venture capital funds invested a record $30bn in crypto companies in 2021, beating the previous record in 2018 of $8bn. Of course, it illustrates a heated market, but at the same time, it shows a larger variance of crypto companies attracting venture capital money within the space, namely exchanges and brokers, but also decentralized finance platforms, NFT platforms, crypto games, etc.


ETH 2.0: The highly anticipated update of the second-largest cryptocurrency Ethereum is expected to go live in Q1 or Q2 named ETH 2.0. Though, please be prepared that we are possibly talking Q3 or maybe Q4 since Ethereum Foundation and its developers are known to postpone deadlines. To make a long story short, ETH 2.0 will make Ethereum significantly more scalable, more secure, and more sustainable. The latter is extremely important, as there is likely no future in proof-of-work, which is the current consensus mechanism of Bitcoin and Ethereum. Proof-of-work is known to use a great deal of electricity as many servers across the globe verify transactions on the network. It is simply too easy to heavily regulate the industry based on solely the sustainable argument while institutions have a good reason to keep a safe distance when the industry is not green.

Circle SPAC: The SPAC deal of Circle, which is the issuer of the second-largest stablecoin USDC with $43bn in circulation, has allegedly been postponed due to SEC's concerns over stablecoins. The SPAC will likely now happen in 2022, whereas was earlier expected to happen in late 2021. Remember, the massive increase in the stablecoin supply, and its general importance on the crypto market. The influence of the SPAC will be somewhat comparable to the Coinbase IPO – if it happens, of course.

Regulation: Even though there were only a few surprises in 2021, regulation is always something to look out for. The regulation sentiment changes daily, so there is no guarantee for 2022.

Layer 2s: Where, for example, Bitcoin and Ethereum, are layer 1 cryptocurrencies with their own settlement layer, you can make them more scalable by building a separate framework on top of them called Layer 2 or L2. For crypto to gain global adoption, and be the settlement layer of the digital age, L2s are indeed needed as they presumably scale cryptocurrencies indefinite in the future. In 2021, L2s started to gain traction, but 2022 will likely be the year where they become a solid part of the crypto market, ultimately showing that cryptocurrencies can scale.

The flipping: This is somewhat of a cliché. However, it is as imperative as always since if Ethereum flips Bitcoin in terms of market capitalization, it will change the sentiment of the crypto market. We are arguably approaching the year with the highest probability of it happening since Ethereum caught up with Bitcoin's lead in 2021 with more authentic use-cases and adoption. Whether it will happen, though, depends on institutional adoption of each crypto, decentralized finance, stablecoins, NFTs, increasing competition to particularly Ethereum, and more importantly, how ETH 2.0 turns out.

Cryptocurrencies have become known for their extreme fluctuations in prices. While there is potential for significant gains, there is also risk of significant losses. Please understand the risks before investing.


The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (
Full disclaimer (
Full disclaimer (

Saxo Bank (Schweiz) AG
The Circle 38

Contact Saxo

Select region


All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved we have put together a general Risk Warning series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law.

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.