As 2022 gets underway, cryptocurrency enthusiasts are hungry for information about the current situation in the segment, mainly as it affects the dominant crypto player, bitcoin (BTC). Depending on whom you speak with, this year could represent either a landmark period for BTC and crypto in general or a so-so time period. The only way to find out is to examine the facts. Step one is to find out what’s currently going on in the alt coin marketplace.
It’s imperative to know where things stand before making an educated guess about what the near-term future holds. For those who are relatively new to the asset class, it pays to understand the several different ways a person can invest and trade with bitcoin and other cryptocurrencies. Anyone who puts their money on the line in the exciting, often volatile crypto market should review the pros and cons of these virtual assets. What’s the future of the sector, and bitcoin in particular? In general, the outlook is very positive, but that prediction must be tempered with facts, caveats, and warnings about both volatile prices and several other unknown factors. The most appropriate place to begin is with the here and now of the crypto markets and their leader, BTC.
What’s Happening in the 2022 Cryptocurrency Markets?
If you look at the 12-month charts for most of the major cryptos, something is very obvious. Since early 2021, all of the alt coin graphs, including bitcoin’s, display an almost cyclical motion. Prices went from a low point to a high and then repeated that same process. BTC’s price swings are a case in point. One year ago, they hovered around the $34,000 point before making a long march above $62,000 by mid-year. Then, everything seemed to reverse and head south, with figures this time dipping below the $30,000 line before resuming an upward once again. That was in late July of last year.
Since then, bitcoin’s value slowly rose, with a few interruptions, through November. By then, it was riding high at nearly $70,000. In two months, that lofty high dropped to just above the $40,000 level, where it is in early 2022. Does this tell us anything? Many keen observers believe that the world’s most popular cryptocurrency is poised for another run-up, and there’s good evidence to support that opinion. For starters, inflation has been steadily increasing for several months as the overall state of the economy worsens in many areas. Because so many turn to alternative currencies in times of economic trouble, the balance of 2022 shows much room for positive movement. Likewise, international investors, both institutions as well as individuals, are starting to view cryptocurrency as a solid hedge against inflation and bad times.
Where are Prices Headed?
Whether you’re trading bitcoin in the UK, the US, or anywhere else on the globe, there’s a high probability that worldwide financial conditions will push the value higher than current levels. What does that mean for investors who want to get into the alt coin market? It means that the early months of 2022 are an ideal time to get involved in cryptocurrency. What is the evidence? There are three essential points that you should take note of. First, BTC is enjoying unprecedented acceptance as more individuals, governments, retailers, major corporations, and institutions recognize it as a valid form of payment and store of wealth.
Second, the virtual form of money has finally become a core part of the global financial system, which means it’s not likely to disappear anytime soon. Third, there are numerous analytical indicators that predict BTC’s price is at a cyclical low. Those three factors outweigh several small negatives and should be enough to at least convince prospective investors that the timing is right for the most capitalized choice in the entire crypto asset class.
Pros and Cons of Crypto Investing
Every investment vehicle has its good and bad sides. What are the pros and cons of cryptocurrencies? Beginning with the downside, prices are volatile, even for the bigger players in the niche. The major advantage is that there’s really no pricing limit. If you look at technical charts and do some basic math, it’s easy enough to make a solid argument for bitcoin reaching above the $100,000 barrier during 2022. Does that mean it will happen? No, but the math, momentum, and logic are on the side of the pro-crypto crowd. The 2022 verdict on BTC’s value is clear. Multiple factors are in play to make it a good buy this year, either as a stand-alone investment or as a hedge within a larger portfolio.
