eCommerce

Rise or fall… What awaits Bitcoin in 2022?

Coinciding with the protests and turmoil that shook Kazakhstan, one of the 3 most important countries in the world in mining virtual currencies, the price of Bitcoin fell in early January to below $ 40,000.

In a report published by the newspaper “Gazeta” (newspapersRussian writer Oksana Reshetova says that the price of Bitcoin witnessed a slight increase on January 11, when it was traded in the range of 41.7 thousand dollars.

A number of experts believe that the political crisis in Kazakhstan played an important role in this decline, as the country’s share of global Bitcoin mining is about 18%, but there are other factors that contributed to the decline in the price of the first digital currency in the world.

Why did bitcoin prices drop?

Artem Dave, principal analyst at AMarkets, believes that the decline in the exchange rate of Bitcoin and other cryptocurrencies at the end of last year is mainly due to new actions in the stock market.

Dave stresses that after the annual inflation rate in the United States rose to 6.2%, a record level not seen in the United States in more than 30 years, it has become clear that the Federal Reserve is close to tightening monetary policy by raising interest rates.

Dave continues that the returns from investing in stocks, currencies and all risky assets, including cryptocurrencies, automatically decline with the increase in interest rates, so investors during the last period avoided the risk of buying bitcoin, ether and other digital currencies.

Dave believes that the developments in the situation in Kazakhstan have also had a negative impact on the Bitcoin exchange rate.

For his part, Sergey Berikhod, a financial analyst at Finam Financial Services, says that the volume of mining in Kazakhstan has witnessed a significant development after the mass exodus of workers in this field from China, due to the pressure exerted by the Chinese authorities on digital currencies.

Berekhod adds that Kazakhstan has become the third-largest cryptocurrency mining world in the world, and as a result of the internet shutdown following the escalation of anti-government protests, the total computing power of mining equipment has decreased by 13%.

But the expert in the crypto-asset market Aaron Chomsky believes that the events in Kazakhstan have not affected the cryptocurrency market, and that the decline in the prices of these currencies is due only to the levels of supply and demand.

The value of the currency last November reached its highest level, exceeding the threshold of 68,000 dollars. With demand falling, Chomsky expects the value of Bitcoin to fall below $30,000.

What will happen to bitcoin in 2022?

Dave believes that the rise in the price of Bitcoin and other cryptocurrencies during the coming period is related to the stability of the global economy and the reduction of interest rates by central banks, because such conditions will attract investors to risky assets.

“Given that this year will see a period of large-scale increases in interest rates by banks, it is unlikely that there will be any rise before the second half of 2022, when investors will return strongly to cryptocurrencies. That may happen if the bitcoin trading price reaches Between 20 and 30 thousand dollars.

“The lower value of the assets will tempt many to invest in cryptocurrencies, and at a later stage push prices higher,” Dave continues.

For his part, Berekhod believes that the US stock market has put great pressure on cryptocurrencies, and on Bitcoin in particular, recently. It is believed that at worst, the exchange rate could reach $36,000.

According to Chomsky, the faster the Bitcoin price declines around $30,000, the higher the chances of it returning quickly to its previous highs, and this may happen in the second half of 2022.



Reference-www.aljazeera.net

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