Bitcoin in 2022: Why to Expect the Bulls?
While no one knows what the future holds for crypto assets, industry experts predict another prosperous year for this genuinely global phenomenon of the 21st century. Many of them claim that the crypto industry is just blooming and that even the oldest of all cryptocurrencies, Bitcoin, is still in its infancy. More maturity could lead to greater stability.
More importantly, Bitcoin and other cryptocurrencies have made enormous progress, not just in terms of valuation (the total cryptocurrency market capitalization is now projected to be $2.5 trillion, up from $1.5 trillion a year ago), but also in terms of acceptability. In terms of headlines this year, whether it be a huge price correction or a massive bullish run, Bitcoin never failed to miss the spotlight. Many notable analysts are bullish on Bitcoin's price and maintain their strong opinion despite its recent price dip.
So with the year coming to an end, there are millions of predictions coming over its price in 2022. But the impact and prominence Bitcoin holds today, it is safe to say that 2022 will be yet another milestone year for Bitcoin and cryptocurrencies in general. This Cryptoknowmics article will help you with reasons why 2022 will be a happening year for the largest cryptocurrency and why it will be the right action to put your money into it.
Bitcoin in 2021
Except for a big Elon Musk-related slump in early June, a prolonged July trough, and an early December flash crash, the fallout from future coronavirus pandemic lockdowns would see Bitcoin climb for most of 2021. At the start of 2021, the financial landscape was bleak, with more stimulus packages on the horizon and supply chain issues beginning to impair global trade. However, from the beginning of January to the present, the world's most valuable cryptocurrency has increased in value by 94.29%.
Now, 2022 is going to be an interesting year for Bitcoin. Several projects are coming up, and institutional investments are most likely to only grow in the upcoming year. Below are the projects and analyses from experts that hold high hopes for Bitcoin.
Jack Dorsey Changes Square’s Name to Block Inc to Focus on Bitcoin
Square Inc., the payments company led by former Twitter Inc. co-founder Jack Dorsey, is changing its name to Block Inc. as it seeks to diversify its business beyond payments and into emerging technologies such as blockchain.
The name "Square" had become synonymous with the company's seller business, according to the San Francisco-based firm. Square noted that the new name will distinguish the company from its businesses, a strategy similar to Facebook's rebranding last month.
Square said in a statement, “The name has many associated meanings for the company—building blocks, neighborhood blocks, and their local businesses, communities coming together at block parties full of music, a blockchain, a section of code, and obstacles to overcome.”
The First Spot-Bitcoin ETF for the USA
A futures contract is a financial derivative that binds an investor to purchase or sell an asset at a predetermined price at a future date. Experts warn the ProShares ETF, which tracks futures prices rather than Bitcoin itself, may be too hazardous for rookie traders trading in cryptocurrencies.
Bitcoin is expected to have a stronger year in 2022, according to market experts. Vijay Ayyar, vice president of corporate development and global expansion at crypto exchange Luno, believes that the first Bitcoin exchange-traded fund (ETF) will be launched in the United States in 2022. He stated:
“The Bitcoin Futures ETF that launched this year has been widely regarded as not very retail-friendly given the high costs involved of rolling over contracts which amount to around 5-10%. Increasing pressure/evidence… points to a Bitcoin Spot ETF being approved in 2022 mainly because the market is now large and mature enough to support one.”
Therefore, with a development like this, it is certain that the bulls will be in control.
Grayscale Has Filed to Convert Its GBTC to a Spot-Bitcoin ETF
Grayscale Investments, the world's largest digital currency asset manager, stated in October 2021 that it has filed with the Securities and Exchange Commission (SEC) to convert its GBTC into a spot-bitcoin ETF. The decision comes after the SEC cleared the door for bitcoin futures ETFs to trade on Friday, with the ProShares Bitcoin Strategy ETF set to begin trading on the New York Stock Exchange later that month.
Grayscale has stated several times that it intends to convert GBTC, as well as its other 14 crypto trusts, into exchange-traded funds (ETFs). Grayscale's ETF would be backed by genuine bitcoin units, rather than being tied to it through derivatives contracts like futures. If the proposal is approved by the SEC, it will mark a significant step forward in the recognition of bitcoin as an investable asset.
Given SEC head Gary Gensler's stated preference for a futures product that may provide additional investor protection, several analysts believe Grayscale's chances of winning approval for a bitcoin spot ETF are comparatively poor. However, if the case gets passed, then it will be a huge success for the token and a 100k target will be a cakewalk.
The $100,000 Milestones
Despite the volatility, many analysts believe Bitcoin is on its way to breaking the $100,000 barrier, though there are differing viewpoints on when this will happen. The volatility is nothing new, and it's one of the reasons why experts advise new crypto investors to be cautious when committing a portion of their portfolio to cryptocurrency. Bitcoin has risen in value as steadily as any other cryptocurrency on the market over the years. It's only natural for Bitcoin investors to wonder how high the currency can rise.
Bitcoin is expected to hit $100,000 in the first quarter of 2022, according to Kate Waltman, a New York-based certified public accountant who specializes in cryptocurrency. “The most knowledgeable educators in the space are predicting $100,000 Bitcoin in Q1 2022 or sooner,” she said.
Bitcoin will become more and more of an asset class utilized for rebalancing investment portfolios as a result of rising institutional interest. According to a Natixis Investment survey, around 28% of large businesses have increased their crypto exposure. In addition, some of the most well-known retailers are beginning to accept Bitcoin as payment. Moreover, payments company Visa has stated that "by 2022, every bank should have a crypto strategy." According to a Bloomberg survey, Bitcoin is on its way to $100,000, but it's "more of a question of time," owing to the economic fundamentals of increasing demand vs. diminishing supply.
Other prominent traders, such as Bitwise Asset Management CIO Matt Hougan and Ballet Crypto CEO Bobby Lee, are predicting that Bitcoin will hit $100,000 by the end of 2022.
Bitcoin 2022 Technical Analysis
Bitcoin is performing well according to long-term indicators. At $46,971 Bitcoin is trading above its 200-day simple moving average at the time of writing. Because Bitcoin is expected to perform better in the coming year, the technical indicators may improve in the coming weeks and months.
By January, the selling pressure from China is likely to subside, and Bitcoin's price, like the mining hash rate, might be on the rise. The MACD and RSI will then move back into the positive territory. Bitcoin's price could conclude 2022 trading above $80k, according to WalletInvestor's 2022 estimate.
Apart from this, it is interesting to note, that every time Bitcoin goes through a serious long-term price correction the circle ends up only on a much higher percentage than it did the previous time. So, even if Bitcoin goes through a bearish trend in 2022, its overall performance is still going to outperform its performance in 2021.
Conclusion
Expect the global economic outlook to rise even more in 2022, as the world finally begins to live with Covid and its variants. Expect a rally in US equities as well as unemployment claims dip continuously and Federal Reserve plans to raise interest rates in 2022. Bitcoin can take advantage of this to enjoy another year of massive profits and upside possibilities. The above are only a handful of reasons why Bitcoin will rise high in the upcoming year. Furthermore, growing adoption in the United States and Europe may offset China's tough position on cryptocurrency prohibition, paving the way for rising demand in the coming year.