We have come to the end of 2022, and as a trader or investor, you have probably experienced firsthand the continuous fall of the crypto market.
Is it the end of the bear market?
Nick Saponaro, the crypto enthusiast and CEO of Divi, has what to say on the market trends this previous year. Saponaro believes that the end is yet to come. He perceives another dip and eventually a gradual climb up to recovery. He brings proof that the previous bear market lasted a whole two years. Since only one year has passed from the current bear market, Saponaro says that we can expect recovery once the market has hit rock bottom.
This won’t be the case as long as the dollar is strong. There is blood in the streets. However, Mainstreet has yet to see it. When it does, we’ll know we’ve hit rock bottom.
Recession
Stores of value frequently experience early recessionary declines followed by late-stage recoveries. Once the crisis has taken hold, it won’t be shocking to see commodities like gold and bitcoin bounce before the majority of other assets. Bitcoin operates much like a commodity. It is a useful store of value that functions like gold. Therefore, there is a demand for it regardless of the macroeconomic environment, perhaps not in the production of physical goods but rather as a means of delivering eCommerce and financial services.
Retail Interest
The two technologies, Defi and NFTs, were the main drivers of adoption during the previous bull run. NFTs have brought the most adoption to the crypto space. This is because NFTs have made crypto accessible for everyone to understand and relate to.
The Metaverse
The Metaverse is currently in the experimental phases. The new year will bring more brands using Metaverse applications for their consumers. In addition, Metaverse will expand past VR and gaming.
FTX Implosion
Rani Jabban, the managing director of Arab Bank (Switzerland), shares his thoughts on the FTX implosion. The FTX implosion was a shock to the majority of the crypto world. The reaction and effects of the collapse will define what the new year will bring.
The Lehman’s moment of cryptocurrency has been compared to FTX, a strong participant with support from large mainstream investors, prominent sports sponsorships, and leaders who were viewed as members of the financial elite. Many victims have lost money, and have many ramifications for those involved in the collapse.
Expected Changes
These shakeouts do have their benefits at the end of the day. They force the sector to improve in various areas. The expectation for next year is that regulators monitoring the crypto industry will make important changes and improve the industry to bring enhanced transparency.
So, anticipate serious measures from American authorities. Offshore locations like the Bahamas will come under growing pressure to follow the lead. When this becomes a reality, the EU will undoubtedly feel the effects of the new crypto regulation MiCA (Markets in Crypto Assets). In essence, we anticipate 2024 to be the year that cryptocurrencies become regulated.
The new year should bring with it many changes in the crypto sector. As there has been more of a drive for regulation and a transparent crypto world, we hope the new year will provide users with that.
