Much is said and written about bitcoin (BTC) and no shortage of prophecies, but what are we to believe now? According to the team at Huobi Research, bitcoin is going to have a tough year and we are going to a bear see market. However, they also think that decentralized finance (DeFi) will actually grow, whereby the role of decentralized autonomous organizations (DAO) will also increase.
Bitcoin has started the year 2022 with significant setbacks. Earlier this month we saw a bitcoin crash, partly because the US Federal Reserve is going to change its balance sheet. And even now, the Federal Reserve seems to be impacting the red coloring crypto quotes. The price of BTC has fallen below $39,000, reaching its lowest level since August 2021.
Last year was generally a good year for bitcoin, crypto and blockchain. Price developments were mostly positive and sectors such as DeFi and NFT’s (non-fungible tokens) made a real advance. Huobi Research also has a trend report published with the crypto trends for 2022. There are plenty of great developments planned, but the outlook for bitcoin is a bit more gloomy.
What can bitcoin expect?
So what can bitcoin expect? If Huobi Research’s predictions come true, the answer to that question is a bear market. This has to do with the Federal Reserve’s plans to partially remove (digital) stocks from its balance sheet. Something that seems to indicate that the dollar is losing its yield. When the Fed took a similar step in 2013, we saw a bear market of about two years.
The market today, however, is no longer comparable to that of then. The number of users and the amount of money that is now in circulation is many times greater than in 2013. Still, Huobi thinks that a development like then cannot be ruled out.
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