It’s been a wild year for the crypto market. Bitcoin enjoyed a strong run. The price of bitcoin increased by nearly 70 percent, it boosted the total market value of the cryptocurrency market to more than $3 trillion for a brief period. Ethereum as well as a handful of altcoins that have been recently launched also showed a great performance with significant gains, far more than bitcoin in many instances.
NFTs or non-fungible coins (NFTs) were made more available to investors at retail and mainstream artists. Metaverse, a different aspect of the crypto world was gaining a lot of popularity. This year was a record year for transactions within the Metaverse. Facebook has changed its name from Facebook in name to Meta in order to become the main torchbearer for creating the virtual world. Crypto genius is another service that you would like to focus on.
Investors are eagerly anticipating what the coming year has in store for the cryptocurrency market. 2022 is also anticipated to be a significant year for the cryptocurrency market. The positive market trends that emerged in 2021 are expected to continue into the following year. The cryptocurrency industry is also anticipated to witness more participants in the market. Investors can expect these trends in the crypto market in 2022:
Crypto regulations to be a focus
Regulators around the world have examined the potential impact that cryptocurrency has on the economy. Central banks from a variety of nations such as India were warned of threats to the stability of financial markets due to cryptocurrency. From El Salvador’s decision to adopt bitcoin to be a legally-valid tender to China’s ban on cryptocurrency-related activities in the declaration of a cryptocurrency regulation bill coming soon that includes the ban of any cryptocurrency that is private in 2021, the year 2021 saw many regulatory actions. This trend is expected to continue into 2022. The year could also see the introduction of the central bank’s cryptocurrency (CBDC).
Crypto-related institutional investments markets are likely to increase
In the past year, the cryptocurrency industry has attracted massive investment from well-known corporations and financial institutions. Venture capital funds, as well as investors, invested around $30 billion to the market in 2021, according to reports. The number of institutional investors within the cryptocurrency market is expected to rise in 2022. Since Microsoft and Facebook investing heavily in the metaverse, and large brands such as Nike as well as Adidas getting into the market, the crypto industry is likely to witness a lot more investment in the coming years. The financial decentralization (Defi) sector is also predicted to see lots of activity. Banks, too, have begun to recognize the potential of cryptocurrency and are looking to provide support to the cryptocurrency market. Loan products that are backed by cryptos are being launched by large banks like Goldman Sachs.
Bitcoin is likely to stay under pressure
Bitcoin will likely end the year just less than $50,000, however, that comes after hitting a new record of almost $700 in the month of November. The cryptocurrency had begun the year at about $29,000. Following the huge gains that came with this year, investors are expecting an upward trend for the historical cryptocurrency by 2022.
Carol Alexander, professor of finance at Sussex University, told CNBC she believes bitcoin will plummet to just $10,000 by 2022, essentially eradicating the gains it made in the last year and a half. She believes that bitcoin “has no intrinsic value” and is more than a “toy” instead of an investment.
There are experts who believe that the bitcoin rally will be back soon and this time the cryptocurrency will quickly break 100,000 dollars.
Market growth for NFT is likely to keep growing
NFTs have assisted creators and artists gain access to funding options that are decentralized. In turn, they are more flexible in funding their projects. Because they are built on blockchain technology, NFTs are very secure and can be used to verify that the asset is owned by the owner. Because of these advantages, they are well-liked by creators and artists. Thus cryptocurrency is likely to witness an increase in the value that is a result of an increase in this NFT market.
Web 3.0 is expected to become mainstream
Web 3.0, the third version of the internet, is currently in the process of being developed. The idea behind Web 3.0 is that in Web 3.0, people are able to finance their websites by themselves, without having to rely on huge corporations who own servers and charge huge costs. There are other benefits from Web 3.0 like being able to customize the web and avoid the possibility of an isolated failure (a crash on a particular social network, for instance, would not impact your online activities for the time). The growing adoption for Web 3.0 will have a positive impact on cryptos like Ethereum, Livepeer, and Helium as well as other cryptocurrencies which are connected to the third edition of the internet.
The first spot will be released Bitcoin ETF is likely
ProShares’ Bitcoin Strategy ProShares’ Bitcoin Strategy exchange-traded fund (ETF) was launched within the US in 2021, but only offers accessibility to Bitcoin futures but it does not include the cryptocurrency itself. It has been costly for investors who are retail. Vijay Ayyar, Vice President of corporate development and global expansion for the cryptocurrency exchange Luno explained to CNBC, “The Bitcoin Futures ETF that was launched this year has been widely seen as unsuitable for retail investors due to the high cost associated with the rolling-over of contracts, which amounts to about five to 10 percent.”
Investors are now hoping to see the introduction of the world’s first spot bitcoin ETF which will give access directly to the cryptocurrency.