A lot of people were expecting the current crypto market cycle to finish at some point in late 2021.
Bitcoin did reach a new all-time high of almost 70k in early November, it also pulled back considerably since then. A lot of indicators are suggesting that we’re nowhere near the end of the cycle and considering that the crypto market overall slowed down considerably towards the end of the year, I think we will likely see this cycle extending into the second half of 2022 and possibly even 2023.
So what’s to follow in 2022? Plenty.
Considering that we may still have good 12 months or more of this bull run, what trends we are likely to see in the crypto space in 2022?
I think that first of all, we should expect some surprises, as it’s often the case in the crypto space or any other new and rapidly developing technology.
So, what are we likely to expect?
Crypto Gaming and the Metaverse
This one is pretty obvious It’s a continuation of a theme that dominated the crypto space in the second half of 2021.
Crypto gaming and the metaverse will remain one of the main trends, if not THE main trend, for the next few years and will likely be one of the key elements in mass adoption of crypto.
A lot of projects, which had their IGO in 2021 are aiming to release their games in 2022 so we will see which projects will make it’ and generate huge profits for their investors and which ones will fail or maybe need more time to become successful.
Perhaps the most immediate story line already breaking through in 2022 is the volatility seen in crypto prices.
Granted, crypto assets like Bitcoin, Ether, and others are inherently prone to wild swings. But, in just a few short weeks, Bitcoin has already gone on quite a ride this year. After starting 2022 north of $46,000, the world’s largest crypto dipped in a 14% tumble over the next 10 days that led it below $40,000. Bitcoin has since posted a gradual comeback that has led it back above $43,000, for now.
. Altcoins including Ether, Solana, and Polkadot, as well as meme tokens like Dogecoin, have all seen dramatic bouts of volatility in their prices in recent weeks — as has everything from technology stocks to the share prices of newly public companies.
Cardano (ADA) has been on a downtrend since the release of smart contracts in early September. Although we’ve seen a bit of a breakout in the last few days, I think we will see a continuation of this general downtrend (or sideways movement) until we start seeing some true utility in the Cardano ecosystem. It will come, I have no doubt about it, but I think it may still take a few months. If the market picks up overall, we will likely see Cardano going up as well but the true parabolic move up will likely happen only after the whole ecosystem properly launches.
Cardona ecosystem will likely flourish in the second half of the year. If anything, this just means that we will have even more opportunities to invest and move our profits around to compound the results. I think 2022 will be an extremely exciting year for the crypto space and I’m really looking forward to it.
With Bitcoin having the same carbon footprint as the country of Kuwait, crypto’s environmental footprint has long been a point of concern for everyone from lawmakers to advocacy groups to chief executives.
Now, the network behind the second largest crypto, Ethereum, is hoping to pivot to becoming Ethereum 2.0, or Eth2
In 2022, after years of anticipation, the Ethereum blockchain is gearing up to move to what’s known as a proof-of-stake model. It’s a shift that Ethereum’s followers say will make it more scalable and secure, as well as more environmentally friendly than the current proof-of-work, PoW, system it relies on just as Bitcoin does. The environmental concern around PoW is that the so-called miners expend massive amounts of energy to perform mathematical computations and, as a result, create new Bitcoin or Ether. Proof of stake, on the other hand, is built on the premise of a handful of individuals or groups staking the platform’s native currency (Ether, in this case) to validate transactions.
The Ethereum Foundation has estimated that the network’s energy use will be cut by up to 99.95% as a result.
But the “merge” that will finally move Ethereum off proof of work has been delayed before, prompting the question of how the final stretch will go from here. Currently, the Ethereum Foundation estimates this transition will take place in the second quater.
Utility and Decoupling
I think these are the two keywords for crypto and NFTs in 2022. We’ve started already seeing this trend in NFTs — we moved from 10,000 generative images to utility such as generating tokens, ‘baby’ version of the genesis collection, access to alpha communities, games or gamification, etc. A lot of people who are investing in crypto now are investing in whatever can give them a quick gain. I expect this to start shifting towards investing in projects (games, DeFi etc.) that people actually use themselves and it’s easier for them to see the value in those projects. This in turn will lead to decoupling from bitcoin and the ‘main’ crypto market — again, we’ve already started seeing this with gaming cryptos and NFTs.
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