After the crypto market’s massive success in 2021, experts and general crypto users had high expectations for 2022.
However, there were mixed feelings about how well the crypto market would do because, by the end of 2021, there was a significant decline in the value of most digital coins.
Many experts have made predictions about the crypto market for 2022, and some believe that it will be a good year for traders. However, there are also challenges that they may face.
In this article, we will consider some of the top predictions by crypto experts and the challenges they might encounter.
Top 10 Expert Predictions
1. A massive Crash or Rise in the Market
While some experts are predicting that the crypto market may not crash in 2022, it’s still possible that prices for individual cryptocurrencies could fall.
For example, after reaching an all-time high of $68,000 in November 2021, the price of bitcoin fell to $46,000 by December 2021.
This sudden decline caused many people to question the stability of cryptocurrencies. Despite this setback, demand for cryptocurrencies is expected to rise because more people are using them for everyday transactions.
2. Rise in Bogus Crypto Currency Affiliates
The crypto market is full of misleading individuals who hoax investors and crypto traders of their profits. It is estimated that there might be some dubious transactions in the market as crypto prices rise.
In 2021 alone, more than 46,000 people reported losses as they fell into some questionable transactions. Over $1 billion was lost in that year only.
As the prices of coins rise, people might get emotional and will be lured by scammers who present fake investment opportunities to them. They also use fake testimonies to lure unsuspecting individuals.
Therefore, it is important to keep emotions aside when you want to trade crypto. Try to think with your head and not your heart in order to avoid being taken advantage of by those who would do anything to make a quick buck – even if it means ruining other people’s lives in the process.
3. Increase in demand as rigid Crypto regulations are made
Some experts and crypto investors believe that wider crypto acceptance by more people is possible as the government roll out regulations that favor the crypto market.
They suggest that the need for strict regulation of some crypto policies is necessary as scammers have continued to look for loopholes to defraud people. They reason that when people feel their investments are safe, they become more comfortable investing.
4. The use of Crypto will promote financial inclusivity among the marginalized segment of society
The market is predicted to distribute billions of dollars in value every day in 2022. It is also anticipated that more than 500 million people will own at least one digital cryptocurrency by the end of that year, making it more acceptable in society.
Since the creation of cryptocurrency, there has been a divide between the crypto world and centralized financial institutions. However, over the years there has been some acceptance by some financial institutions.
In 2022, it is predicted that more acceptance of the crypto market would be embraced by the mainstream financial institutions. This would bridge the gap between traditional finance and cryptocurrency, making crypto more mainstream and accessible to everyone.
Predictions show that more crypto-friendly services will be rolled out by mainstream financial institutions.
This is because cryptocurrency is gaining more popularity and people are beginning to use it more frequently. By offering these services, mainstream financial institutions would be able to attract more customers and retain their existing ones.
6. Increased Volatility is expected with a steady rise in price
The crypto market is well-known for being highly volatile. This is unlikely to change any time soon, as it is simply part of the market’s nature. experts have predicted that there will be some serious volatile movement in the market in the near future.
This volatility could go in either direction – positive or negative – but one thing is for sure: the price of some digital coins is expected to increase.
Many experienced traders enjoy market volatility because it opens up opportunities for higher returns using strategies like “buying the dip” and “selling at high”.
However, it is important to carefully analyse a particular coin before investing, to make sure that a quick move in the wrong direction will not ruin your portfolio.
7. Most ‘meme’ coins could disappear
In early 2021, some meme-based coins saw a price surge of over 10,000% in less than a week – only to crash soon after. The price hike couldn’t be maintained as investors weren’t convinced of the project, leading to many amateurs losing their investments.
Some of these “meme” coins might be projected as the next big thing but soon after they disappear.
When you are thinking about investing in a project, it is important to consider the future and stability of that project. This will save you from any potential losses and help you keep your portfolio balanced.
8. Cryptocurrency in 2022 might either outperform or underperform
Cryptocurrency is a high-risk asset, and it is predicted to follow the stock market’s behaviour. If the stock market surges in 2022, crypto trading is likely to perform better than expected. However, if the stock market underperforms, the crypto market will probably underperform as well.
Cryptocurrencies are speculative and risky in nature. Therefore, if risk assets decline, it will help fight off inflation and would be a primary beneficiary in that circumstance.
9. There could be a ripple effect due to market difficulties in 2022
Some crypto assets may experience a short-term price dip due to difficulties in the mainstream financial market.
10. Steady Movement Toward Decentralized Finance
In 2021, the world of Defi expanded in ways many of us couldn’t have imagined and it’s predicted that in 2022 decentralized autonomous organizations and decentralized finance might just take the lead in the crypto world.
Defy allows for traditional financial products to exist without an intermediary which is a huge step for the crypto community. In 2022, we predict that more people will start to pay attention to this network as it continues to grow.