Crypto 2022: Bitcoin at $100,000?

 

Crypto 2022: Bitcoin at $100,000?

 

 How will the crypto market develop in the new year? The world of investors is divided: some are predicting a high for Bitcoin, while others are expecting a crash landing

After the Federal Reserve went hawkish towards the end of the year, the crypto market ran out of momentum - while other risk assets were mostly spared. Also in the new year, many experts see the official monetary policy as the decisive driver of Bitcoin & Co.

However, some recognize trends that can make the digital currency market less dependent on the macroeconomic environment. On the one hand, this is supported by the involvement of tech giants such as Meta Platforms (formerly Facebook) and Apple in the Metaversum. Boost could also come from so-called non-fungible tokens. Last year, an NFT artwork changed hands at auction house Christie's for $69.3 million.

 

The following is analysts' take on what to expect in the crypto market after Bitcoin's volatile 60% price surge in 2021 in the new year:

Bullish Bitcoin Technique

"We are long-term bullish on Bitcoin based on our long-term trend-following measurements," said Katie Stockton, founder of Fairlead Strategies. “We expect the long-term uptrend to continue.” A more decisive breakout to new highs would pave the way for around $90K.

 

 

Bitcoin is currently trading below $46,600, above $46,300 at the end of 2021 and $69,000 at its November highs and below $7,200 at the end of 2019. "It came to our notice then. List now," Stockton said.

 “However, there are potential signs of near-term exhaustion of the downtrend.”

The Fed and the Metaverse

“The number one driver of Bitcoin and cryptocurrencies in 2022 is central bank policy,” said Antoni Trenchev, managing partner at crypto lender Nexo. “Cheap money is here to stay, which is having a huge impact on cryptocurrencies,” as “the Fed doesn’t have the guts or the backbone to weather a 10% to 20% stock market drop along with a negative bond market reaction.”

Trenches see a choppy 2022 but predict Bitcoin will hit $100,000 by the end of June. However, he doesn't expect tokens like Solana and Avalanche to offer the same exponential growth as 2021. "These upstarts - full of arrogance, attitude and hip narratives - will face the same scaling challenges as Ethereum and other legacy protocols."

"What fascinates me in 2022 is the Metaverse," says Trench."It's going to be one of the main themes for next year: metaverse, infrastructure construction, and then NFT, which is going to be part of the economy there."

Skeptic

"While I expect cryptocurrency speculation, such as ballooning technology assessments, to continue, it will face a difficult environment in 2022," said Jeffrey Haley, an analyst at Onda Asia Pacific. The main reason for this is the start of the normalization of interest rates by the Federal Reserve, which will be followed by other major central banks.

 This will question the raison d'être of cryptocurrencies as an alternative to fiat money.”

 

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“There's a risk of more regulation hanging over the crypto space, and frankly, with a new coin coming out every week that's supposed to be 'the next big thing', I don't know if anyone has what it takes,” says Halley. “I continue to believe that cryptocurrencies are the greatest collective idiocy of all time in the financial markets. The music may continue for a while in 2022, but the Emperor still has no clothes on.”

Waiting for an App Store

“The cryptocurrency app store race has begun,” said Philip Gradwell, chief economist at information service Chainalysis."An important lesson from Web 2.0 is that consumers like the platform, and I don't think that will change for Web 3.0." At the moment, there is no dominant crypto platform for consolidating customer relationships and service providers. “I hope 2022 will see many companies shake-up to create such a platform, leading to the integration of Coinbase Defi and NFTs.