“It has been an eventful 2021 for the crypto market as it has seen extensive price surges, rise of the NFTs and the DeFi space. The year 2021 was also a year of uncertainties with Covid19 lurking from the dark and regulations looming from above. The year 2022 is expected to be another year for crypto bullish scenarios and we are going to explore 5 such scenarios.”
The starting of the year 2022 has not been great as the crypto market is at a 3 month low as the Federal Reserve is tightening on the free money by raising interests and shrinking their balance sheets after printing a lot of money in a span of 2 years. This is not an ideal start for the year, though there are certain reasons, which are the resultant of an eventful 2021 that will help in providing a momentum for the crypto bulls to continue throughout 2022. We will explore these reasons here.
Reasons Why 2022 can be a Bullish Year for Crypto
The Bitcoin ETFs
After a long wait, the Bitcoin ETFs have started to get approval. This is quite bullish for the crypto markets as the Bitcoin ETFs will create a new class of investors that will put their money into the crypto markets thus strengthening the market as a whole and in preventing the market crash from otherwise erratic regulations from the governments around the world. Though ETFs right now are the future’s ETFs, till they provide a kind of a start that is needed.
Corporations are into Crypto
Huge corporations are investing heavily in crypto or also known as Institutional investing is on the rise. This increased institutional investing in the market provides better stability in the market and builds trust among the retail investors that in turn ensures an overall bullish sentiment. It also reduced volatility in the market as corporations invested for the long term.
Bitcoin Mining Exits China
China accounted for more than 51% of the Bitcoin miners in the whole world and it was a security threat for Bitcoin as the Chinese Government could have forced a 51% attack on the network. With the Chinese ban on Bitcoin mining, it has made Bitcoin more decentralized than ever and is an extremely bullish scenario for the whole crypto industry as it is not under the control of a single country.
Softer Regulations on Crypto
The Government around the world previously were aggressively against the crypto industry and were eyeing to curb crypto to the extreme. Even a blanket ban was an option, but by the end of 2021 this sentiment has been completely changed and now the Governments are eyeing on regulating crypto in a softer and in a more friendly way. This creates a bullish scenario in 2022 as the regulations will be rolled out.
Scaling Solutions are on the Horizon
The Year 2022 will be the year of scalability for the crypto as more adoption has led to the increased congestions and high fees on the blockchain networks and most of the blockchains such as Ethereum and Cardano are eyeing for improving their scalability in 2022 which will ensure more and more seamless investing into crypto.
Disclaimer: The article is meant for the educational purpose only and in no way it should be considered as financial advice. Own research on the topic is advisable.
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