Bitcoin fluctuates sharply, uncertainty remains high in 2022

With the assistance of traditional finance, the price of Bitcoin hit a record high in 2021, but it is difficult for cryptocurrency experts to predict what will happen to the volatile cryptocurrency next year. Schematic/Ingimage

In the traditional finance assists, 2021 Bitcoin price hit a record high, but encryption currency experts Nanyiyuce dramatic fluctuations next year what the outcome of encryption currency.

Agence France-Presse reported that between December 2020 and April 2021, the price of Bitcoin more than doubled to $60,000. However, Bitcoin's recent trend has been sluggish. As it enters the new year, its price has fallen below the $50,000 mark.

Bitcoin's rise in 2021 coincides with an increase in Wall Street's interest in cryptocurrencies. The cryptocurrency exchange Coinbase went public in April, driving the price of Bitcoin to a record.

After the Bitcoin futures ETF was listed for trading on the New York Stock Exchange (NYSE) in October, the price of Bitcoin exceeded $66,000.

Elon Musk, the chief executive and founder of Tesla, a major electric car manufacturer, publishes a controversial tweet about cryptocurrency on Twitter, which can influence the rise and fall of Bitcoin.

However, China has continued to suppress cryptocurrency and announced a total ban on cryptocurrency trading and mining in September. At the same time, regulatory agencies in Europe and the United States have also taken actions to affect Bitcoin.

Huong Hauduc (Transliteration), a digital asset broker and general adviser of the exchange Bequant, said: "Cryptocurrencies are not certain and have never been ruled out. However, one thing is certain, that is, voices calling for regulation of cryptocurrencies."

The financial turmoil broke out in 2008, and Bitcoin was born that year. In the beginning, Bitcoin promoted the ideals of liberalism and sought to overthrow traditional monetary and financial institutions, such as the central bank.

In order to mine more bitcoins, miners must have powerful electricity to power their computers. Recently, this issue has attracted the attention of climate change observers.

According to some analysts, Bitcoin faces fierce competition risks as it enters 2022, especially its evenly matched rival, Ethereum.

According to CoinGecko, a cryptocurrency tracking agency, the total market value of cryptocurrencies is US$2.36 trillion, and the total market value of Bitcoin is US$900 billion.

Frank Downing, an analyst at ARK Investment Management LLC, believes that “Bitcoin is unwilling to evolve its design” compared with other cryptocurrencies such as Ethereum. In fact, this feature provides stability and consistency. It is the conditions required for Bitcoin to become a truly global currency.