The biggest winners of the crypto industry in 2021

The year  2021 was also marked by continued price volatility, baffling behavior from China, a grand experiment in Central America, escalating institutional interest, and the rise of some faster smart-contract networks — all of which is reflected in this year’s list of industry “winners .

Kazakhstan

When China effectively banned Bitcoin (BTC) mining operations in May 2021, Kazakhstan rushed in to fill the vacuum, pitching displaced miners and others on its cheap and plentiful coal supply. Many set up operations in the Central Asian country, including a top-five crypto mining pool operated by BIT Mining.

By July 2021, Kazakhstan’s average monthly hash rate share stood at 18.1% — that is, it accounted for nearly a fifth of the world’s Bitcoin mining output, second only to the United States (42.7%), and a stunning increase from only 1.4% in September 2019, according to the Cambridge Centre for Alternative Finance.

Coinbase

Coinbase Global, the largest cryptocurrency exchange in the U.S., became the first crypto company to list on a U.S. stock exchange when it debuted on April 14 on Nasdaq. It closed that day at $328.28 with a market capitalization of $86 billion, a stunning launch that invited comparisons with Facebook’s and Airbnb’s initial public offerings. Its share price came back to earth by year’s end, however, standing at $243.35 on Dec. 18, with a still-strong market cap of $52.37 billion.

Solana

A tide of new smart contract-enabled networks emerged on the scene in 2021. The largest and fastest-growing among them was Solana, a super quick proof-of-stake network that claims to have clocked 50,000 transactions per second (TPS). By comparison, Ethereum does about 30 TPS.

“No project — maybe in crypto’s history — has gotten hotter, faster than Solana in 2021,” wrote Messari’s Ryan Selkis. The open-source blockchain hosts a growing number of NFT and DeFi projects, although it was subject to several distributed denial-of-service attacks through 2021. Solona’s (SOL) native cryptocurrency comfortably ranks fifth among all coins as of Dec. 20

Nayib Bukele/El Salvador

El Salvador made history in 2021 — becoming the first country to declare Bitcoin (BTC) legal tender. The country’s dynamic president, Nayib Bukele, captivated the crypto world with his doings: harnessing energy from a volcano to power his country’s BTC mining operations, air-dropping $30 of BTC to every adult in the country, and, in late November, announcing the launch of Bitcoin City, a fully functional city built around Bitcoin, funded initially by $1 billion Bitcoin bonds.

Mike Winkelmann, aka Beeple

When art house Christie’s put up for auction in February a digital collage — the first major auction house to offer a purely digital work with a unique NFT — it didn’t even attach a price. No one knew how to value it. The work “Everydays: The First 5000 Days” by Mike Winkelmann (aka Beeple) sold for $69.3 million, and the art industry may never be the same.

Avalanche

Avalanche was another speedy smart contract network that shot into the top 10 in 2021. “Solana and Avalanche are the new stars” among DeFi multichains, declared CoinGecko, with 6% and 2% total value locked (TVL), respectively, in the third quarter. (Avalanche hosts the Aave DeFi protocol.) Those TVL gains came at the expense of Ethereum, which held virtually all DeFi TVL at the year’s beginning (99%). Its share was 76% at the end of the third quarter by comparison.

Sam Bankman-Fried/FTX

In 2021, Sam Bankman-Fried was declared “the richest person in crypto” largely on the strength of his ownership stake in FTX, the cryptocurrency derivatives exchange, which he founded in 2019.

By the end of 2021, FTX had become the second-largest crypto derivatives exchange, according to CoinGecko, trailing only Binance (Futures). Messari called FTX “the fastest-growing company of all time,” noting that Bankman-Fried had built a $25-billion enterprise in less than three years with fewer than 100 employees.

OpenSea

The NFT phenomenon has been a boon for digital artists who can sell their works without agents and physical art galleries, but they still need digital marketplaces. OpenSea, a first mover in the NFT art sector and the leading marketplace, emerged as one of the year’s biggest winners.