Americans earned over $4 billion from bitcoin in 2020—more than 3 times as much as investors in any other country

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Interest in bitcoin, the largest cryptocurrency by market value, surged in the past year.

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Notable investors, including Stanley Druckenmiller and Paul Tudor Jones, bought the digital coin; companies like Square, Tesla and MicroStrategy added bitcoin to their balance sheet; and alongside institutional investors, retail traders began to swarm the market.

As a result, many Americans profited. Investors in the U.S. made an estimated $4.1 billion in realized bitcoin gains in 2020, according to a new report by software company Chainalysis.

That’s more than three times as much as the next highest country, China, where investors pocketed $1.1 billion in profit, Chainalysis found.

Chainalysis disclosed that the reported figures are estimates derived from transaction data the company tracks and says it’s impossible to determine for certain where parties are located due to the blockchain and its decentralized design.

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Though China historically has the one of the highest cryptocurrency transaction volumes, Chainalysis reports, U.S. exchanges saw “huge inflows” in 2020.

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“We know from past research that there is growing institutional investment in crypto assets, notably in the U.S. Institutional investors work with large quantities of cryptocurrencies and have been stockpiling bitcoin over the past year,” Kim Grauer, director of research at Chainalysis, tells CNBC Make It.

In addition, “the gains in the U.S. mostly came in toward the end of the year and, therefore, we suspect many institutional traders who fit this profile took in gains as the price rose in late 2020.”

Bitcoin hit a high of about $29,000 in late December 2020, according to CoinMarketCap, but earlier in the year, went below $4,000.

“We expect the price rally in late 2020 led many of these investors with an exit plan to realize the gains they made earlier in the year,” Grauer says.

After China, investors in Japan earned the next highest amount, with an estimated $929 million in realized bitcoin gains. After that, U.K. investors realized $829 million, Russian investors realized $632 million and German investors realized $607 million.

“We can start to see country-level variation in the way gains are taken,” Grauer says. “For example, we know that certain countries with a robust cryptocurrency ecosystem, such as Vietnam, took in outsized gains given the overall size of the economy.”

Bitcoin hit an all-time high of over $64,000 in April, but crashed in May. Bitcoin is currently trading at around $36,000, according to CoinMarketCap, with a market value of $684 billion.

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