Bitcoin forecast for 2022

At the world cryptocurrency conference, leading analysts gave their Bitcoin forecast for 2022. The opinions of experts are divided, but most of them concern an increase in the price of the coin until the fall of this year. There are also pessimistic forecasts for the Bitcoin exchange rate for 2022. Let’s get to know them better and find out what the price of this leading cryptocurrency today will depend on.

How the results of the Consensus 2018 conference will affect the Bitcoin rate

How the results of the Consensus 2022 conference will affect the Bitcoin rate

The Consensus 2022 cryptocurrency conference was held in New York in mid-May. The event had a much larger scale than in 2017, attracting 7,000 people interested in cryptocurrency. Most of them are investors, traders, there are also owners of large companies, funds, and developers.

The official conference carried with it many important tasks, the main one of which was raising the next “buzz” around digital currencies. Thanks to the event, the rating, trading volumes and, consequently, the Bitcoin rate should have increased again in May 2022. The 2022 consensus did create the necessary excitement, but at the same time, a very slight increase in the price of the cue ball.

Expectations were not met. If before the conference the Bitcoin forecast for 2018 was more than optimistic - up to 10.15 and even 20 thousand dollars - then after a couple of days everything became clear. The cue ball rose a little, but not at all as expected. If such an important event as the world cryptocurrency conference had virtually no effect on the price of Bitcoin, then things are not going so well for it.

The hopes placed on the cryptocurrency conference were not justified

But many people immediately have a hypothesis. This is a completely adequate forecast that explains the slight increase in the Bitcoin exchange rate after the 2022 Consensus. It is as follows: the price of Bitcoin must fall further in order for it to start being bought in large volumes. That is, investors are waiting for a new decline, followed by purchases and an increase in the exchange rate.

This is an optimistic Bitcoin forecast for 2022, which is a completely unsuccessful explanation for its low price even after the conference. Most likely, the reason is completely different, and even an important event did not in any way affect the price of the cue ball in May. Nobody expected it to rise so little. Most expected a greater effect after the two-day Consensus.

Okay Bitcoin, is it going to be 4200 or 5200?

Analyst botje11-24-12-2018-BTC-USD, well known to our blog, writes that an increase in the Bitcoin rate to 5,000 is possible, but first there will be a correction of 3,800; or better yet 3,500 – to form a more stable support line. That is, the forecast for this week is 3,800.

Bitcoin goes to 5,000

TomProTrader-24-12-2018-BTC-USD analyst sees an uptrend and we could see a Bitcoin rate of 5,000 this week. But it is quite possible that this ascending line will be broken, since it is not that strong yet.

Correction and growth 4,400

Analyst xuanhaimmoer-24-12-2018-BTC-USD sees 2 possible types of correction before growth. And as a result of any of them, this week the rate will be 4,400.

The downward trend in the dollar continues

Analyst MagicPoopCannon-24-12-2018-BTC-USD sees a continuation of the downward trend, with a possible rate of 3,500 this week.

A giant magnet will pull Bitcoin up

I would like to leave the analysis from last week: Analyst jacobcanfield-12-17-2018-BTC-USD, sees that the rate will change upward. as if he were being pulled upward by a giant magnet.

Buying or selling?

This link has a real-time technical indicator from the tradingview service 12/24/2018 . Today Bitcoin is actively being bought (it hasn’t been like this for a long time).

Why Bitcoin Won't Break the $7,000 Bottom

In May 2022, there was a decline in the Bitcoin price, and bears dominated the market. The chart kept showing red candles in a row. Trading volumes also dropped significantly. Against this backdrop, experts have made a pessimistic forecast for Bitcoin for 2022 - its fall to $7,000. But it was not justified - the cue ball again rose to $8,000 and even reached $8.5 thousand on many sites.

Perhaps the conference and the news from the crypto market yielded results, but the Bitcoin rate still rose slightly in the twentieth of May. The maximum increase in trading volume on large exchanges ranged from 1 to 4% - weak dynamics. The popularity of the cue ball has nevertheless declined. Now other coins, that is, altcoins, have come to the fore. Ordinary consumers and investors are more willing to buy them, and even recently released promising tokens.

But still, the cue ball is unlikely to fall below $7,000. Experts unanimously give an optimistic forecast for Bitcoin for 2022, or more precisely for the summer. Although they gave the same for the beginning of spring and May. Now the chart shows a positive trend, due to which trading volumes and prices have increased slightly. There is a chance that the coin will not break through its $7,000 bottom until early summer. On the contrary, against the background of a stabilizing exchange rate, demand and price will increase.

Bitcoin price will break $15,000 - forecast for summer 2022

Bitcoin price will break through $15,000 - forecast for summer 2018

In the twenties of May, Bitcoin returned to growth again and even reached $8,500. What's next? The forecast for the summer is over 10 thousand, or even more. The wildest assumptions are that the Bitcoin exchange rate is $15,000. But if a few months ago such a figure was easily achieved, thanks to the slightest important news, now everything is much more complicated. For the rate to take off, global changes in the world of cryptocurrencies will be required.

Let's remember 2022, when the price of Bitcoin was more than $15,000 and the demand happened very quickly. What contributed to this then? One of the main levers of the herd is the addition of Bitcoin as futures on American exchanges. We are talking about real platforms with numerous assets, and not about crypto exchanges. This did not yet indicate the official recognition of Bitcoin in the United States on Wall Street, but it was still a breakthrough.

But let's return to the current situation - to 2022. Bitcoin and other altcoins, in fact, were never recognized. Moreover, they began to have a strict regulatory policy. Many countries have introduced a ban on exchanges and mining. If cryptocurrency was recognized, it was not as a means of payment, but as an asset.

Bitcoin needs recognition to increase its value

In order for the Bitcoin forecast of $15,000 for 2022 to take place, the introduction of institutional foundations, legal status, and support for exchanges and miners is required. Will governments take such a step? Most likely no. But investors themselves, especially large ones, still play a big role. They are primarily interested in making a profit.

If trading dynamics change and daily volumes creep up, then the Bitcoin rate will increase. Against the backdrop of an increase in its rating and performance, large investors will join in. They can lead to a cue ball price of 10-15 thousand dollars. This figure is predicted for the summer of 2018. Some experts are talking about autumn or even winter, like last year.

So far, only private, “retail” investors, including ordinary consumers, are interested in Bitcoin. There are not many large market participants. But they can also increase the price of the cue ball if the number of retail investors increases. To do this, the rating of coins must also increase significantly. So far, the world conference has done little to boost demand. You should expect another event or news event.

Is it worth getting involved?

Until now, not everyone knows what cryptocurrency is, and whether it is even worth working in this area. It is really difficult to predict the behavior of graphs. Bitcoin has its advantages and disadvantages. It is in their analysis that the answer lies whether it is worth working with this coin. A comparison will be made with alternative physical money.

Advantages

Bitcoin really has many advantages. It is worth recognizing that this is a real innovation, which in the future can change the world beyond recognition. At least that's what the developers wanted.

Independence from the banking system and the state. No one can control the issue of currency; no market participant is able to destroy Bitcoin or influence transactions. At the same time, the electronic payment system itself is invulnerable, since it is decentralized and located on each computer separately.
Projected growth over the long term. The Bitcoin exchange rate does not depend on political or economic events. It is most influenced by the number of participants in the electronic payment system. At the moment it has covered only 3% of the possible market. There will definitely be growth in the future.
Complete anonymity of transfers. No one is able to find out exactly who sent the money and to whom.
Transactions take place within minutes, even if the sender and recipient are several thousand kilometers apart.
Transfer fees are minimal or non-existent. This is especially important when sending money between countries.
Possibility of independent emission (issue of new coins). You can use your own computer or a specialized mining rig to literally “print” new bitcoins.
Limited number of coins. The specifics of the cryptocurrency creation system do not allow the creation of more than 21 million coins. Inflation definitely does not threaten this system.
Availability. Anyone can register a wallet and use it without restrictions.
The system is open, you can always familiarize yourself with ongoing transactions.
The Bitcoin coin is very expensive. At the moment, 1 bitcoin is equivalent to $8,000. Not all things you will be willing to pay that amount for. Fortunately, it is possible to divide into ultra-small shares so that a share costs less than a cent.

That is why many continue to be interested in the field of cryptocurrency, invest their own funds or mine.

Flaws

They also occur, but are mostly temporary. The gradually growing prevalence and increasing knowledge in general about cryptocurrency offsets these shortcomings.

The chart behaves a little differently than on classic currency pairs. It depends on other factors. Therefore, traders will have to adapt.
Creating new coins will not always be profitable or even possible.
Cryptocurrency is not widely used. Today you won't be able to pay for purchases in most grocery stores. Over time, this opportunity will appear.
Bitcoin has no collateral. It's a valuable collection of ones and zeros on the Internet, nothing more. There is absolutely no connection to any asset.
In some countries, cryptocurrency is illegal; using bitcoins can be punished. However, Russia supports and is actively studying this direction, trying not to isolate itself from new technologies, but to use them in the interests of citizens.

As a result, we can say that cryptocurrency will gradually replace conventional banknotes. It is quite possible that rubles, dollars and euros will completely lose their value, but this will not happen soon.

In any case, Bitcoin remains a very interesting financial instrument that needs to be actively studied and used to your advantage. In addition, experts predict its growth in the long term, this is a chance for you to profitably invest your savings or include cryptocurrency in your investment portfolio. Follow the Bitcoin exchange rate and invest correctly.

Bitcoin price forecast from Thomas Lee

Leading Fundstrat analyst Thomas Lee explained why the Bitcoin rate did not increase during the Consensus 2022 conference. Great hopes were placed on it, expecting a rise in the price of Bitcoin and even many altcoins. It was Thomas Lee, an expert with a high level of trust and reputation, who gave a positive forecast for Bitcoin for 2022. He talked about raising the price immediately after the May conference, which never happened.

Firstly, Thomas Lee based his forecast on the result of last year's world conference. Then the market dynamics changed by several tens of percent. Trading volumes increased by almost 70%. Therefore, the analyst predicted an increase in market dynamics from 10 to 70% in 2022. As we can see, even now, when the Bitcoin rate has risen to 8.5 thousand dollars, trading has increased by only a couple of percent. The maximum on the exchanges is an increase of 4%. This is definitely not what Thomas Lee expected.

On his Twitter, he left the following message explaining the reasons for the fall in the cryptocurrency rate:

Bitcoin price forecast from Thomas Lee

Translation of Thomas Lee's message:

“After Consensus 2022, the rally never happened, which is disappointing. This is what we needed for progress: first, institutional tools, leverage, second, attracting the banking sector and large investors, third, certainty in government regulators. But progress occurred only on the first two points. »

Thomas Lee explains the lack of rise in Bitcoin's rate by its semi-official status. He says that government regulators are inactive. This is not about the control of cryptocurrencies, but about their implementation at the official level. It is necessary to at least recognize digital currency by states and create an institutional and legal framework. Then large institutional investors will enter the market, who now simply do not want to take risks.

But at the same time, Thomas Lee gives his Bitcoin forecast for 2022 - an increase in the price of the coin to $15,000 and above. He expected this to happen earlier, immediately after the conference, but it seems that takeoff is delayed until the summer or even autumn. Investor interest in Bitcoin has dropped significantly. They consider this currency to be of little interest and overgrown with technical difficulties. Most altcoins, compared to Bitcoin, have lower fees and higher speeds.

Does Bitcoin's falling rating mean its end? According to Thomas Lee, no. Still, Ethereum and Bitcoin are the leading cryptocurrencies in the world, whose status is inviolable for the coming year. The level of trust in them is much higher than in new coins or altcoins. The analyst in his forecast speaks of an increase in the Bitcoin exchange rate in 2022. He does not give exact dates or months.

Bears will rule the market until the end of 2018

There are eight main reasons why 2022 will not be the year the bull trend returns:

Historical cycles

In 2015, there were not many people who were interested in Bitcoin or other cryptocurrencies and, most likely, a similar situation is expected in 2022, when we look at it with an eye on the future. These days, too, very few people are becoming interested in an asset class whose price is declining.

In 2015, only 2.3 million new wallets were activated, compared to more than 9 million in 2022. Activated wallets are a good but imperfect metric for measuring the growth of new investors joining the cryptocurrency ecosystem.

If you look at the period 2014-2015, then the bearish trend lasted about 19 months. The price reduction was about 80% from the peak level. The current downward trend has been going on for 7-9 months, depending on specific calculations, and so far there is no reason to change the situation.

Hashrate

Over the past seven months, the hashrate of the Bitcoin blockchain has tripled. This parameter is an indicator of calculations per second within the Bitcoin blockchain network. According to analyst Tuur Demeister, this means that a huge number of new, more efficient mining services and solo miners have appeared on the network.

If you own one of these installations, you may notice a significant decrease in profitability. This means that the miner needs to sell more mined coins to cover costs. It is estimated that about 1,800 BTC are mined every day (12.5 per block at 144 blocks per day). This has caused supply to outstrip demand in the market as miners are forced to sell more bitcoins to cover their costs instead of hoarding them.

As a result, the daily profitability of Bitcoin in US dollars per transaction hash has decreased by 92.6% from December highs.

ETF Delays

The popular belief is that an ETF (exchange-traded fund) regulated Bitcoin would attract significant capital inflows into the asset class, causing the price to rise. This catalyst is often compared to the first gold ETF. It was approved in 2004, and the price of gold rose 350% the following year. In the first half of August 2022, the SEC delayed a decision on the ETF proposal, while maintaining high hopes for support from BTE VanEck SolidX until the end of September 2022.

The ETF approval process allows the SEC to make a decision within 240 days of filing the application in the Federal Register, so it is clear that the SEC will use all the time at its disposal to its advantage. With more time, more information and research can be conducted on the spot market, allowing the SEC to make a more informed and informed decision.

The next extension of the application review period is expected at the end of September, and the final decision date on this proposal will be February 18, 2022. Therefore, you should not count on the announcement of the decision as an opportunity for the “bulls” to take control of the market situation.

Metcalfe's Law

It characterizes network effects in technology. From this theory comes the Network Value to Metcalfe (NVM) relationship. Between 2015 and 2022, NVM analysis showed that Bitcoin was undervalued. The price comparison was made with the number of active network participants, but this changed in 2022 and the price began to approach the normalized NVM ratio.

Now this ratio suggests that the current market capitalization of Bitcoin is too high when examining market activity. A similar comparison is the network value-to-transaction (NVT) ratio, which is similar in principle to the PE ratio in stock markets.

This ratio is calculated by taking the value of the network (market capitalization) and dividing it by the daily Bitcoin market volume in US dollars or the volume of coins moving within the blockchain. A high NVT ratio may signal high growth or an unsustainable bubble, but ultimately it simply signals that the network is overvalued relative to the transaction volumes within it.

In 2022, the NVT ratio rose from 65 to 193 points.

Retail Interest

This figure fell in 2022 after a sharp drop in price. Professional analysts have faced a barrage of questions about whether Bitcoin can make anyone rich in 2017. Back then, small investors feared that they would miss out on the “next big opportunity” and were willing to buy Bitcoin at any price as it grew exponentially, so as not to miss the “party” in the future. This catalyst began to cause the price to rise more and more, which also caused high volatility.

Three metrics to use to measure interest in small trading are traders' income, Google searches, and Wikipedia searches. Merchants are now facing a 50% decline in Bitcoin trading revenue, with Google searches for the word “Bitcoin” down to 10% compared to 2022 levels. Daily visits to the Wikipedia page dedicated to Bitcoin have dropped by almost 100 thousand unique visitors and are now around 10 thousand.

Clear regulatory definitions

There was some regulatory clarity in 2022 when SEC Director of Corporate Finance William Hinman stated that Bitcoin is not secure. For the market to turn bullish, Bitcoin must become a global instrument of exchange and maintain its value. But for this it is necessary to ensure broader regulatory certainty and regulation of this area at the global level and not only in the United States.

Last week, the Winklevoss ETF was rejected again. One of the main reasons was the assumption of a possible risk of asset manipulation on the spot market. Governments in most countries around the world need to decide how Bitcoin should be used in the long term from a tax perspective, and the underlying spot market needs to become more regulated (to ensure there is no manipulation). This will ensure an influx of capital into Bitcoin, but these conditions will require a certain amount of time.

Bitcoin is blown away - is it so?

All cryptocurrencies are associated with Bitcoin, considering it a kind of standard, king, or even the grandfather of digital currencies. But few realize that he now performs the same function as the Queen of Great Britain. It seems that she exists, but only nominally. Power is concentrated in completely different hands. However, the life of the royal family is under the radar of cameras around the world. Her rating is high and her authority is indestructible.

The same thing happens with Bitcoin. The level of trust in it is stable, the coin has a high rating and authority. But still, many call it a soap bubble that is now deflating. And the reason is not even a low rate or bad news, but technical coins. Other cryptocurrencies (altcoins) have appeared on the market for a long time. They have the following advantages:

Faster transaction processing speed, unlike slow Bitcoin.
Low commission.
New technology, such as smart contracts or advanced blockchain.
Scalability.

The main advantages of altcoins compared to Bitcoin are listed, but there are many more. Technically, the cue ball is significantly behind its competitors, but still has nominal power, like the British queen. But will his debt rating be indestructible? If large investors who want to pour their capital into Bitcoin do not appear on the market, then its leadership position will be shifted.

However, the largest trading volumes with cryptocurrency in dollar equivalent belong to the cue ball. It still has the largest capitalization and rate. Therefore, the majority gives an optimistic Bitcoin forecast for 2022 with a price increase of several thousand dollars. Of course, it began to deflate as a soap bubble, since it is technically weaker than its competitors.

Why Bitcoin collapsed: the creator of the cryptocurrency made a forecast

Since its inception ten years ago, one “cue ball” has been worth a fraction of a cent. Those who once bought it cheap - not to mention the miners - became multimillionaires in a few months last year. Those who sold it in the initial stages of capitalization growth were biting their elbows. Everyone else dreamed of acquiring Bitcoin for the sake of easy profit in the future: it was predicted to grow as much as $100 thousand.

But the expectations were not met: over the past year, the cryptocurrency managed to fall in price by 6 times...

“Crypto is the future”, “Buy bitcoins before it’s too late”, “I got 20 times rich with cryptocurrencies”—social media feeds were full of such quotes at the end of last year.

Thousands of newly minted crypto investors, who managed to “join the topic”, staged a real vanity fair, boasting about easy money. Bitcoins and other similar currencies were bought by everyone who had the money for it; as a result, the market became oversaturated, reached a peak, and the rate began to roll back.

Already in the winter of 2022, Bitcoin cost $15-17 thousand, then it remained at the level of $10-12 thousand, and in the fall it rapidly lost capitalization, falling below $4 thousand at the time of writing this article. Many factors contributed to the fall, from checks on Chinese bitcoin exchanges to skeptical statements from billionaires Bill Gates and Warren Buffett - more on this below.

“I can’t even sell off the farms I bought”

Now Bitcoin is a falling asset with a dubious reputation, but this does not change the fact that in its 10 years of “life” it has done something unimaginable.

A payment system based on blockchain technology was created by a person (or group of people) under the pseudonym Satoshi Nakamato in 2009. Along with it, a unit of the same name appeared for recording operations.

In 2010, the first exchange of bitcoins for real goods took place: American Laszlo Hanecz bought two pizzas with delivery for 10 thousand of these virtual coins. Bitcoin gradually grew in price: it cost $10, then $300, then broke through the then unimaginable ceiling of $1 thousand. Then they paid attention to it and began to take it seriously.

In 2015, the European Court of Justice classified Bitcoin transactions as fiat payment transactions (that is, legal tender not backed by reserves) and recommended that EU members not impose value added tax on such transactions.

In 2016, Japan recognized Bitcoin as legal tender, the United States declared it a “decentralized virtual currency,” and Switzerland equated it with foreign currencies that have the right to circulate and be accepted for payment in the country. China has recognized cryptocurrencies as goods, also allowing their circulation.

In different countries, virtual blockchain money had different legal status, but they inexorably became part of the financial systems of states.

The popularity of “cryptocurrency” among the population was growing: in 2013, there were about 2.9 million users of virtual wallets in the world, and in 2022 there were 5.8 million of them. There are even more wallets themselves: their number increased from 8.2 million in 2013 to almost 35 million in 2016, that is, 4 times. Of these, 80% are used to exchange national currency for digital currency, and 20% are associated with credit cards.

The largest number of wallets are registered in South and North America, as well as in Asia - naturally, Russia did not stand aside. conducted a study that showed how Russians’ search queries for Bitcoin have changed over the past 9 years. As it turned out, requests began to appear, although extremely rarely, in 2009, after the creation of the miracle currency.

In 2010, the flow of searches for information about Bitcoin stabilized, but was still weak: during this period, the first crypto exchanges began to appear, on which “virtual” money could be exchanged for regular currency. The peak of requests occurred in December 2017, when the Bitcoin exchange rate reached a historical maximum: during this period, people were interested in Bitcoin more often than in the dollar exchange rate.

During moments of general crypto hysteria, the interest of Russians in purchasing mining equipment also grew. Let us remind you that any cryptocurrency can be “mined” using computers and video cards connected to them, which select codes to solve various problems in the blockchain system, receiving a virtual coin for this.

Judging by search engine data, demand for video cards increased sharply in May and December 2022, which has now fallen sharply. This is confirmed by statistics from one of the free ad services.

Now searches for mining equipment are three times less frequent than in January, and requests for ready-made mining farms (they need to be assembled from several video cards) have decreased by 2.5 times. Farm values themselves fell by almost 38% in 10 months.

During the same time, on the ad aggregator website, searches for the words “mining” and “bitcoin” decreased by 4 times, and the number of advertisements for the sale of equipment for cryptocurrency mining increased by the same amount.

Due to the loss of interest in cryptocurrencies, since the beginning of 2022, the cost of equipment has almost halved: from 154 thousand to 86 thousand rubles. A heartbreaking photo of a “graveyard of mining farms” in China is floating around the Internet.

MK contacted one of those who entered the business of selling farms at its peak and managed to make good money. But now things are not going well, admitted Moscow resident Alexey, who moved to the capital from the Trans-Baikal Territory bordering China.

Last summer, he began supplying ready-made mining farms from China. Old connections with Chinese equipment wholesalers helped launch the business. By the fall and early winter there was no end to buyers. “Business was going great, and I was trading with a margin of 10%.

I flew to China on business once a month, it was quite expensive, but there was enough money for it. When Bitcoin and other cryptocurrencies began to fall, demand became piecemeal. In general, I stopped doing this, I can’t even sell off the farms that I have already purchased,” Alexey finished.

A “cemetery of mining farms” has appeared in the Chinese province of Sichuan. Photo: Still from video

Spoofing, hackers and other troubles

So why has Bitcoin fallen from the dizzying heights it reached a year ago? The trigger for the collapse was the actions of the American financial authorities regarding cryptocurrencies.

In June, the US Commodity Futures Trading Commission requested transaction data from major crypto exchanges Bitstamp, Coinbase, itBit and Kraken. The commission was interested in whether exchanges used price manipulation schemes. While awaiting the results of the audits, trading volumes on exchanges decreased (who would want to invest in an unregulated market if the exchanges are manipulating the price?). The US Department of Justice also initiated a criminal investigation aimed at identifying illegal methods of manipulating rates.

One of these methods is spoofing, a common occurrence in the cryptocurrency segment. The essence of the technique is to artificially place a large order to buy or sell crypto on the exchange (sometimes the amounts reach up to $60 million) at a price significantly lower or higher than the actual value. In this case, the order itself is not closed, but is removed from trading even before the transaction is completed.

When such a large supply appears on the exchange, traders and trading bots begin to actively sell or buy currency in order to catch it before the attractive price changes. At this time, the fraudster identifies real orders, which allows him to sell or buy coins at a high price. Due to the created illusion, for example, of a high price of a currency, the exchange rate can soar.

Most exchanges fight against spoofing - in particular, they limit rates. However, this phenomenon still occurs frequently, and especially on the most popular exchange - Bitfinex. Many suspect that the exchange deliberately carries out outbreaks of spoofing attacks and launders its tokens, selling them to itself at an attractive price.

The New York prosecutor's office was also interested in illegal methods, which in April of this year launched a procedure for analyzing the work of cryptocurrency exchanges. The reason was a message from several platforms about the inability to control or prevent manipulation in the market.

In addition to the impunity of manipulators, trust in Bitcoin was undermined, firstly, by tightening regulation of cryptocurrencies in the world (IT powers such as Japan and Korea announced their intention to “tighten the screws”), and secondly, by hacker hacks of the Coinrail and Bithumb crypto exchanges, which occurred in June 2022. $37 million was stolen from the first exchange, and $30 million from the second. It turned out that cryptocurrencies, which became exchange commodities, are not so transparent and secure, and therefore not reliable.

Metamorphoses have also occurred in the ICO market, an exchange-based tool for raising funds from investors to launch or expand startups. These three letters stand for Initial Coin Offering, and got their name by analogy with IPO (Initial Public Offering) - a traditional method of placing profitable shares of a company to attract investment. In ICOs, instead of shares, there are tokens; these are the internal assets of the company that investors are offered to buy. Translated from English, “token” means a sign or symbol, which explains the essence of the term. A token is a unit of accounting created on the basis of blockchain technology. Unlike a virtual coin, which can be exchanged for another currency or payment, it has more functions. When the project of a company that has launched an ICO starts working, tokens can be exchanged for goods, services of the company, or received dividends.

Last year, entrepreneurs rushed to conduct ICOs in droves; it was considered a relatively easy and inexpensive way to get funding for projects: you just had to hire blockchain specialists and promote yourself to investors. Since the market was not regulated and the whole process took place in the virtual space, many scammers appeared who scammed ICO investors out of their money.

“Now the costs of conducting an ICO have increased significantly. The organizers of such transactions are subject to liability for failure to fulfill obligations to investors. There are much fewer scammers. The market began to regulate itself. As a result, the interest that provokes the speculative rate has subsided,” lawyer Artur Ibragimov explained in a conversation with MK.

Vitalik Buterin: “The year may be promising, but this is not certain”

At the end of December last year, the co-founder of Bitcoin.com, Emil Oldenburg, sold all his bitcoins, saying that this cryptocurrency “has no future.” “Investing in Bitcoin is the most extreme investment you can make. People will start exiting Bitcoin when they understand how it works,” Oldenburg said in an interview.

He explained that due to the emerging scalability limit of this cryptocurrency, large commissions are charged for transactions with it and the speed of transfers is constantly slowing down. Let us explain: the blockchain consists of blocks, their size is limited, and with the growing popularity of Bitcoin, the system does not have time to process all transactions. Because of this, transaction fees doubled every three months, and transactions took hours to days to confirm. This happened because Bitcoin was too popular: everyone wanted to buy it.

However, Emil Oldenburg was not disappointed in cryptocurrency as a phenomenon. He invested in Bitcoin Cash, an alternative to the classic “cue ball”. It costs several times less than its “ancestor” and is gaining popularity, but so far it ranks 4th in the top 10 most common cryptocurrencies. Bitcoin still dominates the market: its capitalization is greater than the total value of other virtual currencies combined. At its maximum it was approximately $340 billion, but over the year it fell to $70 billion, that is, almost 5 times.

In second place in terms of capitalization among virtual currencies is ether, a unit of account on the Ethereum blockchain platform. This cryptocurrency is called the “digital analogue of oil” or “digital gold” for the complexity of its production, limited supply and high investment qualities. Like other cryptocurrencies, against the backdrop of the market decline, ether fell several times in price: since January, its capitalization has fallen by 86%.

MK managed to contact the founder of the Ethereum platform, Russian-Canadian programmer Vitalik Buterin. His Canadian passport says “Vitalik.” According to the latest information, he now lives in Singapore. At 24 years old, he is the owner of a multibillion-dollar fortune (according to some sources, about $30 billion - although this figure seems greatly exaggerated to many experts), the creator of one of the most promising blockchain projects and a man who is called Crypto-God in mining circles.

Vitalik Buterin, nicknamed Cryptogod. Photo: ru.wikipedia.org

Amid the collapse of cryptocurrencies, Vitalik lost about $460 million; now there is about $40 million left in his crypto wallet with ethers. However, the blockchain genius is not discouraged; on the contrary, he seemed to have expected such a turn of events. Buterin answered our questions on the social network.

— Vitalik, I would like to know your opinion about the fall in the capitalization of cryptocurrencies: will it continue or will the market stabilize?

— The fall of the market is a pattern after such stunning growth. Perhaps it will continue, but then there will be a long flat (a period of time during which the price does not rise or fall - I.D.), then an ascent to new highs.

— Have you experienced a loss of interest in cryptocurrencies yourself or among your blockchain colleagues?

— Blockchain is currently being implemented in various areas of developing countries. In this regard, 2019 should be a promising year, but this is not certain.

— Will these new exchange rate highs that you are talking about beat the previous ones, last year’s? Is it worth buying Bitcoin or another cryptocurrency that has fallen in price now in anticipation of a new takeoff? And if so, which one?

— It’s worth buying any cryptocurrency from the top 10, but this is not certain.

We also asked Vitalik about the prospects of another IT genius from Russia, Pavel Durov: will the creator of the most popular domestic social network launch his own cryptocurrency? Buterin did not answer, but the other day it became known about Durov that he still plans to launch the TON (Telegram Open Network) platform before the end of the year. Its test version is already 70% ready and everyone is waiting for the start of sales of the crypt, which can replace Bitcoin.

The platform itself is tipped to become the basis for a new decentralized economy of the future. It will have an electronic wallet, cloud data storage, a platform for secure micropayments and other bells and whistles that will appeal to those who dream of a free Internet (the platform was created using technologies that allow the blocked Telegram to work in Russia).

Photo: Ivan Skripalev

The story is not over

Against the background of the exchange rate catastrophe in the virtual currency market, the gurus of the crypto world remain calm. Professional traders are sure that panic is caused by those who do not understand anything about the laws of the market. In the slang of exchange players there is the concept of “hamsters”: this is the name given to novice crypto traders who are highly susceptible to mass panic and regularly sell or buy cryptocurrency at the most unfortunate moments.

“Last year’s rise in the cryptocurrency rate was due to a surge of attention, not only from the specialized community, but also from ordinary people who have nothing to do with IT or the financial sector,” notes Arthur Ibragimov from Prifinance. “Over the past year, the market cryptocurrency has changed a lot, as has the attitude towards it. Many have encountered fraud due to the lack of legal regulation in this area in most countries.

However, what is happening now with the cryptocurrency market is more likely not a decline, but simply stabilization, there are fewer scandals, and therefore the excitement is subsiding. Stabilization is also indicated by the fact that right now large investors are beginning to really show interest in cryptocurrencies, because tools have just begun to appear for them that would allow them to work with this market. The fact that countries have begun to develop and implement appropriate legislation also works in favor of stabilization.”

Alpari analyst Vladislav Antonov believes that the lingering uncertainty regarding the regulation of the cryptocurrency market is still preventing investors from returning to buying electronic cash. “But soon this issue should be resolved: then the market will reboot and become better, the volatility of coins will decrease.

However, I do not rule out that the fall in the price of cryptocurrencies is nothing more than a medium-term plan of the central banks of countries that want to discourage individuals from working with virtual money, which could create a threat to fiat money (the so-called ordinary money of states, the value which are established by the government - I.D.," the expert believes. At the same time, even the International Monetary Fund admits that the circulation of cryptocurrencies in the financial systems of countries cannot be ignored. The head of the IMF, Christine Lagarde, recommended that country regulators study the issue of issuing their own digital currency to compensate for the decline in cash use.

It is obvious that the story of Bitcoin, the king of cryptocurrencies, is not over yet. Investors who have not yet been disappointed in him still hope that he will again reach the $20 thousand mark: not this year, then next. Others believe that alternative cryptocurrencies are the future. However, blockchain and virtual money are conquering the world because behind them is nothing less than a new ideology, based on transparency and decentralization (read: freedom from regulators) of all operations. And this is something that is highly valued in the financial world.

Pessimistic forecast for Bitcoin for 2018

At the same 2022 Consensus conference, speakers expressed their opinions on the need for cryptocurrency to exist. The Internet needs it as a native unit of calculation. With its help you can:

Make instant payments around the world, including international ones.
Pay a minimum commission for cryptocurrency transactions.
Hide your data, including from regulators, fiscal and other authorities of your country.
Conduct completely confidential transactions, etc.
Make instant transfers.
Pay for goods and various services. Internet services.

Now let’s think: “Does Bitcoin meet all of the above points?” No, it has disadvantages:

High commission.
Low speed of all transactions with Bitcoin, not to mention its forks.

That is, you can’t just buy pizza or a cup of coffee for Bitcoin online. You need to pay a large commission or wait for the transaction to be processed. It is slow and expensive, which does not make cue ball the native currency of the Internet. Consequently, it is considered only as an asset on crypto exchanges. In 2022, the forecast for an increase in the exchange rate in the spring did not come true. It only went up to $8,500. And you can’t call it growth, because it cost more than 9 thousand.

Small purchases for bitcoins are unprofitable

They predict a new fall in Bitcoin in 2022, and in the summer. Few experts and analysts voice this opinion, but it still exists. While most expect the exchange rate to rise in the summer, others talk about its fall. Even leading experts and analysts have repeatedly made mistakes in their forecasts, including at the conference. Therefore, it is impossible to speak for sure about a pessimistic outcome.

Why is Bitcoin so attractive?

Everything new frightens a person, but also attracts at the same time. And when people saw that they could make money on Bitcoin, and in very exotic ways, everyone rushed to learn as much as possible about this area. Cryptocurrency will continue to be a promising direction for human development, but what do we have at the moment?

Bitcoin is an interesting tool for saving money in the short term. When the market starts to get hectic, investors look for assets in which they can invest so as not to at least lose their money. Previously, this asset was invariably gold. But it has problems with liquidity and storage. No one can steal Bitcoin, and there will always be people willing to purchase new coins. And with high exchange rate stability, the situation seems ideal, but everything is not so rosy. As practice has shown, even such a powerful currency can fall, and quite rapidly. This is why Bitcoin is only suitable for short-term investments or experienced investors.

Unfortunately, the vast majority of market participants demonstrate blatant ignorance, complete ignorance of the subject of their activity. Therefore, let's start with the basics, tell you what the advantages and disadvantages of Bitcoin are.

Advantages

This coin has plenty of advantages. For comparison, we took ordinary money that people have long been accustomed to: dollars, euros, rubles - choose to your taste.

Availability. Cryptocurrency is always available for withdrawal from your account, at any time and from anywhere on the planet.
Transactions are carried out instantly. Even if a large amount must be delivered to another country or to another hemisphere, the transfer will take no more than a few minutes.
Absolute openness of operations. You can trace the entire history of Bitcoin’s “travels” from the moment of its creation.
Reliable protection. It is impossible to hack Bitcoins, many people have tried. And no one can steal them from you either. The only exception is social engineering. Keep your account data safe and do not trust it to third parties.
Complete anonymity. The transactions themselves may be known. However, the sender and recipient remain incognito. No one can physically detect any information about the owner of a cryptocurrency wallet, with the exception of transfer amounts.
Minimum transaction fee.
Limited quantity. The program code has only 21 million variations. Accordingly, there can be no more than 21 million coins. The possibility of inflation is excluded; no one will be able to print more currency even in case of urgent need. The situation is approximately the same as with collectible paintings. They will always be in price, and no one will be able to create the same ones. But in the case of bitcoins, it won’t be possible to fake it.
This is completely independent money. The system of their circulation is decentralized, located on every connected computer. No country has the ability to control cryptocurrency.

All this attracts the attention of investors, miners, traders and ordinary people who are just planning to invest in something. In terms of advantages, this is an innovative discovery, money of a new generation.

Flaws

However, this new money is still significantly limited in its capabilities. There are a few drawbacks, but they are mostly temporary and driven by market behavior.

High volatility. Now Bitcoin is highly dependent on the behavior of traders. Purchases lead to higher prices, sales lead to lower prices. And half of the bitcoins are concentrated in China. Major players are already manipulating this currency, albeit to a small extent. Volatility is also greatly swayed artificially.
The banking industry is not able to control transfers in bitcoins, as well as their release. You act at your own risk when making a transfer. The danger is that you may make a mistake: sending the wrong person or the wrong amount. It will not be possible to cancel the operation and no one can legally protect you either.
Some states have expressed serious concerns about cryptocurrency; there is still no trust in this payment system. They even punish those who use Bitcoin. Fortunately, Russia is showing positive interest in cryptocurrency.
It's possible to lose your wallet. All you have to do is forget the password for your account.
Each wallet owner is responsible for his own funds; the law does not regulate Bitcoin. If it is stolen, no one will help you defend your rights.
There is no centralized control. People are simply not used to this yet.
No security.
Rarely used in the market.

The disadvantages force many to avoid cryptocurrency. Some experts avoid making predictions on this matter altogether. The market here is practically unpredictable and only insider information known to a very narrow circle of people has real weight.

Bitcoin rate - psychology and herd instinct

Even experts admit that in 2022, it will not be large institutional investors who are investing in Bitcoin, but “private” ones. The course depends on the opinion of the masses - a large number of users, usually ordinary people. They are not experts, experienced traders or analysts. It is important for them to buy a more or less well-known cryptocurrency with a high rating and a growing rate. That's what Bitcoin was.

The opinion of such masses is influenced by news, and indeed by any news feed, by stock exchange statistics. They pour in money when the exchange rate is rising and drain cue balls when the exchange rate is falling. That is, the Bitcoin exchange rate directly depends on the psychology of a large number of people. The most interesting thing: their opinion is of a herd nature. As soon as the user sees the growing trading volume and exchange rate, he himself begins to believe in the cryptocurrency and pours money into it.

The herd instinct is the driving force behind the price of any cryptocurrency. Of course, there are also experienced investors and traders who carefully form their portfolio, make forecasts and conduct analytics. But they are still in the minority. If in 2022 any news fueled interest in Bitcoin, then in 2022 such a move will not work. Now the forecast depends on real actions, events in the cryptocurrency market, and not on the slightest unverified news. Therefore, you should expect an increase in the Bitcoin rate only after important events.

Join our group on VKontakte

What's the catch?

Everything cannot be so perfect; there is definitely a snag that can cancel out all the optimistic forecasts for the Bitcoin price. And she really is, and not alone. In the future, a fall and even a full-scale collapse of the exchange rate is possible. Now experts can identify two reasons: control by Chinese major players and the wholesale buying of coins by market newcomers.

The Bitcoin market was almost immediately captured by Chinese investors, true masters. And they control it in many ways. This is a standard situation for the small market. What does it look like? A conspiracy is established between several market participants. This is followed by a synchronous purchase or sale. The graph subsequently passes through a certain number of points by inertia. The position is then closed or opened, depending on the situation. Fortunately, the influence of this factor is gradually disappearing.

The second problem is even larger. Major players are fueling public interest in coins. And when the market is overheated and the asset is really overvalued, they quickly sell their assets, starting a chain reaction. As a result, the fall can reach astronomical proportions. This situation is still possible in the future, be careful.

Read us first - add the site to your favorite sources.

Add a comment

{"commentics_url":"\/\/express-novosti.ru\/comments\/","page_id":1346939,"enabled_country":false,"enabled_state":false,"state_id":0,"enabled_upload": false,"maximum_upload_amount":3,"maximum_upload_size":5,"maximum_upload_total":5,"securimage":true,"securimage_url":"\/\/express-novosti.ru\/comments\/3rdparty\/securimage\ /securimage_show.php?namespace=cmtx_1346939″,”lang_error_file_num”:”\u041c\u0430\u043a\u0441\u0438\u043c\u0443\u043c %d \u0444\u0430\u0439\u043b\u043e\ u0432\u043c\u043e\ u0436\u0435\u0442 \u0431\u044b\u0442\u044c \u0437\u0430\u0433\u0440\u0443\u0436\u0435\u043d\u043e.","lang_error_file_size":"\u041f\u043e \u0436\u0430\u043b\ u0443\u0439\u0441\u0442\u0430, \u0437\u0430\u0433\u0440\u0443\u0437\u0438\u0442\u0435 \u0444\u0430\u0439\u043b \u0440\u0430\ u0437\u043c\u0435\u0440\u043e \u043c \u043d\u0435 \u0431\u043e\u043b\u0435\u0435 %d MB.","lang_error_file_total":"\u041e\u0431\u0449\u0438\u0439 \u0440\u0430\u0437\u043 c\u0435\u0440\ u0432\u0441\u0435\u0445 \u0444\u0430\u0439\u043b\u043e\u0432 \u0434\u043e\u043b\u0436\u0435\u043d \u0431\u044b\u0442\u044c \ u043d\u0435\u0431\u043e\u043b\ u0435\u0435 %d MB.","lang_error_file_type":"\u041c\u043e\u0436\u043d\u043e \u0437\u0430\u0433\u0440\u0443\u0436\u0430\u0442\u044c \u0442\u0 43e\u043b\u044c ""lang_text_loading":" u0437\u043a\u0430 ..","lang_placeholder_state":"\u0420\u0435\u0433\u0438\u043e\u043d","lang_text_country_first":"\u0421\u043d\u0430\u0447\u0430\u043b\u0430 \u0432\u044b\u04 31\u0435 \u0440\u0438\u0442\u0435 \u0441\u0442\u0440\u0430\u043d\u0443″,”lang_button_submit”:”\u0414\u043e\u0431\u0430\u0432\u0438\u0442\u04 4c","lang_button_preview":" \u041f\u0440\u0435\u0434\u0432\u0430\u0440\u0438\u0442\u0435\u043b\u044c\u043d\u044b\u0439 \u043f\u0440\u043e\u0441\u043c\u 043e\u0442\u0440″,”lang_button_remove ":"\u0423\u0434\u0430\u043b\u0438\u0442\u044c","lang_button_processing":"\u041f\u043e\u0434\u043e\u0436\u0434\u0438\u0442\u0435..."}