All crypto fans agree that 2021 has been a year of momentum for cryptocurrencies. As crypto moved from being just an interesting experiment to a good investment opportunity, traditional financial products lost a lot of pace to crypto.
Despite the occasional regulatory hiccups and the COVID variants that kept traders on edge, the cryptocurrency’s technical picture has taken a much more bullish tint than it ever has. Though on paper, crypto markets are known to be quite unpredictable, however, as the new year draws closer, here are 3 predictions that actually have a good analytical basis in reality for the crypto market in 2022.
1. Crypto Stablecoins to Go Mainstream
Stablecoins are cryptocurrencies that are pegged to fiat money, or to exchange-traded commodities. Being a great enmesh between the traditional financial system into the crypto market, stablecoins are always favorable by new traders as they are a good stable investment that keeps them safe from the eye watering volatility of the markets. It is considered a very reliable way to cash out your crypto gains without waiting for tedious banking procedures of the conventional financial system. The most famous stablecoins are Tether (USDT) and USDC.
Also, governments have been experimenting with stablecoins resulting in Central Bank Digital Currencies (CBDCs).
A CBDC is the abbreviation of Central Bank Digital Currency. As the name implies, it is a digital currency that is issued on a blockchain by a central bank and usually represents the country’s own fiat currency. Unlike other digital coins, CBDC is centralized and regulated by the government.
If you connect the dots, we believe that stablecoins will be the first cryptocurrencies to see serious formal regulations which of course will unleash mass adoption.
2. Bitcoin Adoption will Continue and it will hit $100K
I know some of you are rolling their eyes when you read $100k, but wait let us explain why this prediction might be still valid. Although many respected crypto experts predicted that 2021 will be the year in which bitcoin will hit $100k, but yet BTC never broke above $65k.
Considering the continuous bitcoin mass adoption led by El Salvador and the everyday growing institutional support, $100K sounds reasonable. However, some traders are desensitized to these crazy ambitious predictions:
3. Rise of NFT Popularity to Continue
Non-fungible tokens or NFTs are a special kind of token that contains identifying information recorded in smart contracts on the Ethereum blockchain but can’t be exchanged like other cryptocurrencies which are fungible.
NFTs are proof of ownership that utilizes blockchain technology to connect with a unique digital asset (like rare stones, customized jewelry, digital paintings, or any works of art or rare traits and accessories in video games), that cannot be replicated.
NFTs have made tremendous strides in 2021 bursting into mainstream conversations and this hype is not expected to cool off in 2022.
As NFTs have created risks with their volatile unregulated nature it also created many opportunities. The industry will mature in 2022, and the usage of this lucrative new financial tool will doubtfully extend to cover other digital media. Being popular among younger generations, NFTs have reintroduce scarcity back to arts and this is some transformative renaissance for both artists, fans and investors. 2022 is going to be pivotal to NFTs as it will shift the power structures in all art and music industries.
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