What to expect from bitcoin in 2022?

 

Why analysts expect the first cryptocurrency to grow in the first half of next year and why market participants remain positive.

 

Trader Nicholas Merten believes that bitcoin will be in "sideways" for the next few months, and in March next year will return to active growth and rise to $100 thousand. In the most optimistic scenario, the price of the first cryptocurrency may grow to $200 thousand, Merten said.

In November, the author of the Stock-to-Flow (S2F) model and an analyst under the pseudonym of PlanB admitted that the bitcoin price may exceed $500 thousand at the beginning of next year. The expert argues that the first cryptocurrency is somewhere in the middle of the current "bullish" trend and the peak growth may be much higher than expected forecasts.

RBC-Crypto experts evaluated analysts' forecasts and explained bitcoin's prospects for next year.

High risk

Bitcoin is not a security, and its value depends not only on technical and fundamental analysis, but also on many factors that have a significant impact on the rate, explained the development director of the cryptocurrency exchange EXMO Maria Stankevich. According to her, despite the presence of a certain "bullish" trend, trying to predict bitcoin price in the next year is nothing more than guessing by coffee grounds.

From a fundamental point of view, bitcoin has potential, the expert explained. She added that the cryptocurrency's potential is confirmed by various onchain data and large purchases of bitcoin by "whales" during corrections. However, Stankiewicz reminded that various negative events can significantly affect the quotations of the crypto market.

"Whales" are referred to as investors - large holders of digital assets.

"One possible SEC decision to ban bitcoin or USDT could have a significant impact on the rate," the expert said.

On Dec. 1, SEC Chairman Gary Gensler called bitcoin an autonomous alternative and competitor to the U.S. banking system. Earlier, Gensler claimed that the regulator has no plans to ban bitcoin and other cryptocurrencies.

The potential remains

All forecasts regarding cryptocurrencies should be taken with a high degree of skepticism, says Nikita Soshnikov, director of the cryptocurrency exchange service Alfacash. He agreed with Nicholas Merten that bitcoin will return to the active growth phase after a period of sideways movement, as the cryptocurrency retains the potential to move up.

 

"This scenario is supported by the continued growth in the share of hodlers - investors who prefer to keep bitcoins for the long term in their personal wallets. This has a certain stimulating effect on the bitcoin exchange rate," the expert noted.

 

Soshnikov expressed doubts about the possibility of increasing the price of bitcoin up to $200 thousand next year. The coin will have to quadruple its value to do so, but, in his opinion, there are not enough incentives for such growth. The trigger for more than fourfold growth in 2022 could be the launch of the first US spot bitcoin-ETF, Soshnikov said.

 

"We'll see $200k, but not in the next few months. My forecast is mid-2023," the expert added.

 

Market on the positive side

The current sideways movement in the crypto market does not cause any serious concerns for crypto investors, said Crypterium co-founder Vladimir Gorbunov. According to him, this indicates that most market participants are in a positive frame of mind.

 

"If I was asked personally whether I believe that bitcoin will cost $500 thousand in a few years, without fixating on how many years exactly, I would say that unequivocally yes," the expert noted.

 

According to Gorbunov's forecast, the first quarter of next year will be positive for the crypto market because there are no factors for the growth of negativity so far. New participants are entering the market, trading volumes are growing and promising projects are emerging in the industry, the expert said. After a period of active growth in early 2022, the digital assets market with a high likelihood of a correction, which will last until about autumn, Gorbunov predicted.