Cryptocurrency trends

The omicron variant and growing inflation is triggering new cryptocurrency trends in 2022

After leaving the cryptocurrency investors in awe for a while in October, Bitcoin is back to its moderate US$50,000 value. Ethereum, which is striving to finalize itself as a close ally of Bitcoin or its direct competitor, has also reached record pricing in November. But since then, the cryptocurrency market looks gloomy. Bitcoin that was supposed to hit US$100k before 2021 ended is still on low performance. However, institutional investors, higher adoption, EFTs, NFTs, decentralized applications, smart contracts, metaverse, easy transaction methods, etc are expected to trigger the cryptocurrency sphere towards new highs in 2022. On the other hand, the emergence of the Omicron variant and growing inflation is also expected to contribute to the price spikes. Although virtual tokens remain as a riskiest investment, some cryptocurrency trends are standing by its side to give an edge. Here is a look at top cryptocurrency trends that are expected to shape the market in 2022 and beyond.

Top Cryptocurrency Trends to Lookout for in 2022

 

The Two Sides of Bitcoin

Bitcoin began 2021 at US$29,000 but ended the year at US$50,000, while reaching a record high of US$68,500 in October. According to Bitcoin enthusiasts, the digital token has the potential to reach US$100,000 in the first few months of 2022. With institutional investors onboard and Bitcoin Taproot upgrade on the radar, it will be a matter of months for BTC to break its long-stood resistance. On the other hand, critics are saying that Bitcoin has no fundamental value and serves as more of a ‘toy’ than an investment. Therefore, BTC’s price will fall to US$10,000 in 2021.

Web 3.0’s Influence in Cryptocurrency

Web 3.0 is taking new shape in 2022. Emerging as the third version of the internet, the disruptive web has many things to offer to modern society. Without depending on large corporations and service companies, people get to fund their website using Web 3.0. Besides, it is easy for users to personalize the website and avoid single point failure while using Web 3.0. In the background, famous blockchain networks like Ethereum, Livepeer, and Helium are supporting the sweeping disruption. Therefore, those platforms and their cryptocurrencies are also expected to see growth in 2022.

Ethereum will Continue to Outperform Bitcoin

Although many cryptocurrencies have outperformed Bitcoin on growth rate in 2021, Ethereum stands out from the rest. One reason is that Ethereum is a direct competitor of BTC and it has the potential to overtake the top cryptocurrency in near future. Bitcoin only gained 66% in 2021 while ETHER recorded 418% growth in the same period. This performance gap is the widest since 2015. Since the Ethereum platform also extends its services to a number of newly added features, it is expected to trigger ETHER’s price further in 2022.

Institutional Adoption to Get Prominence

For a very long time, financial institutions and global organizations have viewed cryptocurrencies as a skeptical investment. But the perspective is changing recently. In 2021, more institutional investors have come forward to actively allocate capital to the cryptocurrency area. According to a report, US$15 billion institutional money was assigned to the crypto asset class as of 2020. This is anticipated to grow drastically in 2022 and beyond.

Government Regulations in the Radar

As the adoption of cryptocurrencies has grown drastically over the past year, central authorities are having a hard time moderating digital tokens. They believe that too much cryptocurrency could enable money laundering and threaten global financial stability. On the other hand, it could be redirected for terror funding. Therefore, governments across the globe might impose strict restrictions or at least circulate new guidelines to moderate virtual assets.