Bitcoin in 2022: Main Trends and Forecast

In one country, cryptocurrency mining and settlements were prohibited, while in another, Bitcoin became the official currency. It’s difficult to foresee what problems we’ll face next year, but we can highlight the major themes and provide a bitcoin price projection.

Persistence of Bitcoin

Bitcoin’s ability to recover from yet another round of Chinese government crackdowns has only increased confidence in the currency’s long-term survival. In recent months, Chinese miners’ proportion of total processing power surpassed 60%. It is now zero, according to the University of Cambridge.

The coin was able to return to its May hash rates for six months, and the price totally updated the historical maximum. Bitcoin has demonstrated its usefulness and has become more decentralized as a result of China’s shift away from mining.

Bitcoin Adoption

The degree of bitcoin adoption is one of the important trends that allows for a positive assessment of its prospects in 2022. Chainalysis’ Global Cryptocurrency Adoption Index, which includes 154 nations, has increased by 881 percent since 2020.

The officialization of Bitcoin in El Salvador, however, is a watershed moment: currently, every store must take cryptocurrency as payment, and the number of crypto wallets among individuals exceeds the number of bank accounts.

Bitcoin attracts institutional investors, who are much more interested than average consumers. The expected rise in the cryptocurrency exchange rate attracted “big sharks,” and by 2021, the share of institutional investors with investments of $1 million or more had risen to a new high, topping 70%. The SEC approved the first bitcoin futures ETF in October, and it reached $1 billion in just two days.

Bitcoin is Better Than Gold

Institutional investors’ primary motivation is to protect themselves from inflation generated by the Fed’s ceaseless money printing. Since March 2020, more than a third of new dollars have been printed, and Jerome Powell admitted in late November that increased inflation is no longer a transient phenomenon. Gold has traditionally been used as a form of insurance.

Even major banks, on the other hand, have acknowledged that Bitcoin has evolved into its digital counterpart with better prospects. As a result, according to Bank of America, bitcoin has been more strongly connected with inflation than gold during the last six years.

Bitcoin Price Forecast

Unlike 2020, practically no one now anticipates Bitcoin’s demise, and even well-known figures like Ray Dalio and Jamie Dimon have admitted that their earlier predictions were incorrect. They forecasted a price of 60k+ in January 2021, based on past Bitcoin price multiples of 20k. The whales sold their stocks every time they hit these round levels, according to the figures.

As a result, a conservative estimate for the price of Bitcoin in 2022 is $80,000, while an enthusiastic estimate is $100,000. Because the primary dangers from growing global inflation are just beginning to manifest, the likelihood of a deep correction is judged to be modest. Much depends on central bank monetary policy, but because of the huge level of public debt, Powell will be unable to raise rates as quickly as he lowered them.

According to Harry Yeh, founder and managing partner of Quantum Fintech Group, the Bitcoin exchange rate could reach $400,000 in the next 12 months. This is over 900 percent more than the current market price. At 13:23, Bitcoin was trading at $42.1 thousand, according to CoinGecko.

According to Yeh, investors would utilize bitcoin to hedge against inflation because the Fed (US Federal Reserve System) will continue to print money.

The cryptocurrency market as a whole is on the verge of a growth supercycle with bright possibilities. According to him, the widespread use of stablecoins could lead to a rise in the price of digital assets.
“The current situation is very similar to the 2017 bull market.” We are, without a doubt, in the midst of a bull market. However, it differs from the previous growth cycle in that the use of stablecoins, which are abundant in the present bull market, was not prevalent,” stated Harry Yeh.

What are the prospects for the development of Bitcoin?

Leading analysts in the industry suggest a massive growth of this cryptocurrency in the near future. Today, the price of Bitcoin is 60 thousand dollars. Of course, it is impossible to say exactly when the cost will jump even higher. But approximate forecasts can be made based on the results of technical analysis.
In general, this year the rate shows growth and it is possible that the predicted levels will be reached in the coming months. If you focus on the current situation, the rate of this cryptocurrency ranges from the maximum limit to the average.

Thus, there is reason to believe that the virtual currency will reach a maximum point of 300 thousand dollars, but soon after that it may again decrease several times, dropping to about 50 thousand dollars.
But at the moment, you can not be afraid of a strong depreciation. That is why most investors are not afraid to invest in this coin without waiting for new signs of a financial crisis. And yet, we should not forget that the second quarter of 2021 was not the best period for Bitcoin.