The US was followed by China, which cashed out some $US1.1 billion ($A1.4 billion) in profits in 2020, according to data published by blockchain firm Chainalysis.
Japan came in third with $US900 million ($A1.2 billion), followed by the UK with $US800 million ($A1 billion) and Russia with $US600 million ($A775 million).
The figures only cover realised gains, meaning profits still held in cryptocurrencies or in exchange accounts are not included.
According to Chainalysis, Americans appear to have stepped up their bitcoin investments last year, despite nationwide lockdown orders and record unemployment.
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The top five countries to profit from bitcoin were the US, China, Japan, the UK and Russia. Picture: Marco Bello/AFPSource:AFP
US crypto investors then cashed out towards the end of the year when the price of bitcoin had soared more than three times its $US9000 ($A12,000) price tag.
“US-focused exchanges saw huge inflows in 2020 that appear to have been realised toward the end of the year, which likely accounts for the country’s large gains,” the analysts wrote.
But many people who sold bitcoin in late 2020 probably wish they had held on for longer. The digital coin continued its eye-watering bull run through April of 2020, peaking at $US63,000 ($A81,000) – more than double 2020’s high point.
In recent months, the cryptocurrency has slumped back near 2020 levels, hovering at about $US33,000 ($A43,000) Tuesday morning after declining 10 per cent in just one week, according to Coindesk data.
While cryptocurrency profits can be hard to track due to the currencies’ intentionally decentralised nature, Chainalysis produced its estimate by collecting data including deposits, withdrawals and web traffic from cryptocurrency exchanges like Coinbase.
Other countries that realised large gains from bitcoin last year include Germany and France with roughly $US600 million ($A776 million) each and Spain with $US500 million ($A646 million).
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Bitcoin’s price fluctuations could also be attributed to the fact that the crypto could be more traceable than previously thought. Picture: Karen Bleier/AFPSource:AFP
South Korea, Ukraine, the Netherlands, Canada and Vietnam all booked about $US400 million ($A517 million) in profits each.
Bitcoin’s 2021 woes have been attributed to a number of factors, including the US government’s ability to recover the bitcoin ransom from last month’s Colonial Pipeline hack. That has been cited as evidence that the cryptocurrency is more traceable than previously thought, potentially decreasing its value to certain investors.
The cryptocurrency market, which was once dominated by bitcoin, has also been complicated in 2021 by the rise of NFTs and heightened interest in alternative digital coins like ethereum.
This story originally appeared on the New York Post and is reproduced here with permission