2022 was eventful in the world of cryptocurrency; it was turbulent and confusing for many crypto investors; as of now, they are ready to anticipate and predict when the next bull run of Bitcoin could occur.
One of the industrial insiders at a crypto conference held at St. Moritz, Switzerland, revealed to CNBC that 2023 is a year of caution. Bitcoin is anticipated to trade in a range and continue to be volatile as macroeconomic factors like rising interest rates are sure to affect it. As a result, a new bullish phase is unlikely in 2023.
As per the experts, they are optimistic about the following year.
Following the FTX cryptocurrency exchange’s downfall due to bankruptcies and liquidity problems in 2022, the entire cryptocurrency market lost roughly $1.4 trillion. The infection has spread throughout the crypto industry.
Although Bitcoin has a little head start at the start of the year, similar to risk assets like equities, the analyst points out that chances of another all-time high above $69,000 are improbable as Bitcoin may have bottomed up.
“I think there’s a little bit more downside, but I don’t think there’s going to be a lot,” a venture capitalist and crypto veteran, Bill Tai, told CNBC the previous week.
“There’s a chance that [bitcoin] kind of has bottomed here,” stating that it could fall beyond $12,000 before surging again.
Chief strategy officer at CoinShares, Meltem Demirors, stated that bitcoin would likely remain between $15,000 and $20,000 at the lower limit and between $25,000 to $30,000 at the upper limit.
She revealed that due to “forced selling” in 2022 due to the collapse in the market, there is no new money coming into Bitcoin.
“I don’t think there’s a lot of forced selling remaining, which is optimistic,” Demirors said to CNBC on Friday. “But again, I think the upside is quite limited because we also don’t see a lot of new inflows coming in.”
As a result, Investors are closely watching macroeconomic developments as Bitcoin is showing signs and is closely correlated to risk assets like equities, especially in the tech-heavy Nasdaq. Interest hikes from the Federal Reserve and other macroeconomic developments affect these assets. Risk assets and Bitcoin have been affected by the Federal Reserve’s aggressive interest rate hikes to counter inflation. As per the insider, any change in macroeconomics can affect the price trend of Bitcoin.
“There could be catalysts that we’re not aware of; again, the macro situation and the political environment are fairly uncertain; inflation continuing to run quite hot, I think, is a new thing. We haven’t seen that, you know, in 30, 40 years,” Demirors revealed.
“So who knows, as people look to make allocations going into the new year where crypto will fit into that portfolio?”
Anticipating the next bullish run.
Several industrial participants revealed in an interview with CNBC that a cyclic phase takes place for roughly four years, as per the historical data on Bitcoin. First, Bitcoin hits an all-time high, followed by a massive correction. Then, the cycle generally has a bad year before recovering mildly.
Bitcoin will then “halve.” When this happens, the benefits of mining are split in half for bitcoin miners, who use specialized equipment to validate transactions on bitcoin networks efficiently. For validating transactions, miners are rewarded with bitcoin. Every four years, the price is halved, effectively reducing the amount of bitcoin available for sale. As a result, 21 million bitcoins are all that will ever be in existence.
Halving usually happens before the bullish phase. In 2024, the next halving will commence.
According to Scaramucci, 2023 is a “recovery year” for Bitcoin anticipating the trade hitting $50,000 to $100,000 in two to three years.
“You are taking on risk but you’re also believing in [bitcoin] adoption. So if we get the adoption right, and I believe we will, this could easily be a fifty to one hundred thousand dollar asset over the next two to three years,” Scaramucci stated.
According to Tai, the bullish run is bound to happen “probably a year away,” as the collapse of FTX has affected the entire cryptocurrency market; it is estimated that it will be another six to nine months before the crypto market recovers.
Global CEO of cryptocurrency exchange Bitstamp, Jean-Baptiste Graftieaux, conveyed to CNBC the previous week that the next bullish run could come two years from now, stressing rising interest from institutional investors.
However, Demirors cautioned that the events in 2022 “have caused tremendous reputational damage to the industry and the asset class,” adding that “it will take some time for that confidence to return.”
- Published By Team Genuine Reporter