The crypto market has seen skyrocketing highs and deep lows for the past two years. With 2021 behind us, which was the most significant crypto year ever, more and more experts are becoming skeptical about whether 2022 will have the same results.
Not only did we see prices of cryptocurrencies go up, but also, 2021 was a year for integration and innovation of new coins and major companies and brands embracing NFTs.
Even if crypto experts are skeptical, we know that more and more people are getting interested in digital coins, Non-fungible tokens, etc. While unpredictable events, either digital or real-world, can affect the crypto market, it’s always good to have some general idea of how it may act.
For that reason, we give you six predictions on this topic for 2022. Remember that this is not financial advice and that we are just forecasting possible outcomes.
Numerous Price Drops
With 2021 being a massive year for crypto, especially Bitcoin, there will likely be a period, or multiple ones, where the price of Bitcoin and other coins stays low. While it is improbable that it will surpass the all-time high of $61,374, it is always wise to wait the flat period out.
However, the same thing was said back in 2020, when it soared to $30,000, and people were rushing to sell. Crypto involves a certain level of risk, and it is up to you to decide whether to sell or wait for another spike. You can stay on top of these fluctuations in today’s business and financial news on Fastbull.
Second to Bitcoin, Ethereum holds close to 20% of the market cap. Various elements of this cryptocurrency make it attractive and desired by buyers. Developers are constantly adding new decentralized applications or DApps. On top of that, it is the most used blockchain by a mile, and it is the main currency when it comes to NFTs.
Transaction speed has always been a slight issue, but with ETH 2.0 being released sometime in 2022, those issues will be in the past. It is speculated that the blockchain could process 100,000 transactions per second with this significant upgrade.
Regulation in 2022
The same topic comes up every year – will countries worldwide set clear rules and regulations regarding cryptocurrencies? While countries like El Salvador accept Bitcoin as legal tender, others like China have moved to completely ban crypto and implement their Govcoins, which central banks and governments will back.
There are various ways in which governments will most likely step in to regulate the crypto market. Some of them are creating more stablecoins, increasing crypto regulation, and implementing CBDCs or central bank digital currencies.
Increased Mainstream Adoption
Again, with 2021 being the mega year for crypto, it saw an enormous amount of people getting involved with digital currencies. Statistics show that by the end of 2021, there was an 880% increase in crypto adoption.
With blockchain gaming, NFTs, and the Metaverse, we can expect an increase in new buyers and sellers of crypto, more companies and franchises accepting crypto payments, and a continuous rise and development of new blockchain projects.
More Help From Financial Advisors
In this past year, most financial advisors have had increased work. With more and more people getting involved in crypto, they naturally seek advice. They turn to those who should know the market at best – financial advisors. Financial firms didn’t have the right tools or guidance to make recommendations until recently.
A couple of years ago, financial advisors weren’t very set on crypto and were always advising their clients to stand clear from it. However, they are doing their research today and have slowly started offering advice on the crypto market.
Meme Coins, Pump-and-Dumps, and Scams
With more people getting involved in crypto, more developers will see the opportunity to create their own blockchain game, NFT, coins, etc. While some will be serious and try to make their project legit, many others will advertise their project, make sure people invest, and later dump the whole thing and run away with the money.
That is why it’s advised to do thorough research on the coin or NFT you’d want to invest in.
We can expect 2022 to be a positive year for the crypto market with all said and done. Many new investors, sellers, and buyers will emerge, and more companies and merchants will start to accept digital tokens.
While there may be dips in prices, it is essential to wait it out. Regulations will have to come sooner or later, and we can expect governments to start implementing them as soon as mid-2023.