The Boom and Bust (2021–2023): NFTs, El Salvador, FTX, Banking Crisis

2021 was the year crypto became unavoidable in mainstream culture. Total crypto market cap peaked above $3 trillion in November 2021. Bitcoin reached $69,044 ATH. NFTs went viral. El Salvador adopted Bitcoin as legal tender. Coinbase IPO'd. The cycle was historic in scale. **Q1 2021: Institutional FOMO.** • February 8, 2021: Tesla announces $1.5B BTC purchase. Stock and BTC both rally. • February 9, 2021: BNY Mellon announces Bitcoin custody plans. • March 11, 2021: Beeple's "Everydays: The First 5000 Days" sells at Christie's for $69.3 million to Vignesh Sundaresan (MetaKovan). The first major auction of digital art as an NFT — Beeple becomes the third-most-expensive living artist at auction. • March 17, 2021: Morgan Stanley becomes first major US bank to offer BTC funds to wealthy clients. • April 14, 2021: Coinbase direct listing on NASDAQ ($COIN). Opening price $381 (above $250 reference); initial valuation $86 billion. BTC peaks at $64,895 on the same day. **Q2 2021: Volatility.** • April 23, 2021: Bored Ape Yacht Club mints. 10,000 NFTs at 0.08 ETH each (~$240). Sells out in 12 hours, generating ~$2 million. • May 7, 2021: Dogecoin reaches its ATH of $0.7376 (Elon Musk SNL hosting weekend). DOGE had started 2021 around $0.005 (~14,000% gain). • May 12, 2021: Tesla suspends BTC payments citing energy concerns. BTC drops 12%. • May 19, 2021: BTC crashes to $30,000 (-50% from April peak) following Chinese mining crackdown news. • May 21, 2021: China bans cryptocurrency mining. Hashrate drops ~50% over weeks. US becomes #1 mining destination. • June-July 2021: Bitcoin trades $30K-$40K range. **Q3 2021: NFT explosion and institutional progress.** • August 10, 2021: Poly Network bridge hack — $611 million stolen. The "Mr. White Hat" hacker negotiates and returns nearly all funds within 15 days. Refuses $500K bounty. • August-September 2021: NFT market surges. OpenSea hits $3.4 billion in monthly sales (August), a 1,025% jump from July. Daily volumes peak at $405M. • September 7, 2021: El Salvador becomes first country to adopt Bitcoin as legal tender. Bitcoin Law passed June 9, 2021. President Nayib Bukele launches "Chivo" wallet with $30 sign-up bonus. Adoption faces challenges; usage rates decline over years (25.7% in 2021 → 8.1% in 2024). • Mid-2021: Solana surges; SOL crosses $200 in late 2021. **Q4 2021: Cycle peak.** • October 19, 2021: ProShares BITO launches as the first US Bitcoin futures ETF. Reaches $1B AUM in first week. • November 8, 2021: Ethereum Name Service (ENS) airdrops governance tokens to ~137,000 .eth domain holders. Tokens reach $1.5B market cap within a month. • November 10, 2021: Bitcoin ATH at $69,044. Ethereum ATH at $4,891. Total crypto market cap peaks above $3 trillion. • November 18, 2021: ConstitutionDAO raises $47 million in ETH from ~17,000 contributors in one week to bid on a US Constitution. Loses to Ken Griffin's $43.17M bid (Sotheby's says it was their largest crowdfunding initiative ever). • December 2021: BTC drifts down to ~$46K-$49K range. **Adoption metrics 2021:** • BTC daily active addresses peaked ~1.5 million (April) • Total crypto market cap: peaked $3T (Nov 10), ended year ~$2.3T • Crypto VC investment: $33 billion (record at the time) • Number of cryptocurrencies: ~4,154 by year-end • Bitcoin ATMs: ~34,000 globally • Coinbase verified users: 89M (Q4) • Lightning Network capacity: ~3,000 BTC at year-end • NFT trading volume: ~$25 billion for the year 2021 was the year crypto entered every dinner conversation. The peak of the cycle, in retrospect, was November 10. Everything that followed for two years was deflation.