Blockchain data research firm Arcane Research took a look at the year it was in its final 2021 report and made its predictions for the cryptocurrency markets in 2022.
Arcane’s “Weekly Update” report on Tuesday focuses on Bitcoin (BTC) and Ether (ETH) but delves into other major currencies, decentralized finance (DeFi), memecoins, non-perishable tokens (NFT), derivatives and more. Arcane provided a forecast of what will happen in 2022 in every topic covered in the report.
Bitcoin will outperform the S&P 500 in 2022
The report notes that during 2021, Bitcoin has outperformed the S&P 500. The price of Bitcoin is up 73%, while the S&P 500 is up 28% this year, and Arcane believes Bitcoin will continue to do so next year. The S&P 500 index includes the 500 largest companies listed on US stock exchanges.
“XRP and Cardano will drop out of the top ten”
Arcane noted the massive gains that Binance Coin (BNB) has made this year, peaking at around 1,600% in May and closing the year with an increase of 1,344%. Based on this and the growth in market capitalization of altcoins like Solana (SOL) and Terra (LUNA), along with the NFT craze, analysts are filtering XRP and Cardano (ADA) will drop out of the top ten list.
Alternate classes will continue to outperform ETH
While ETH has outperformed BTC this year with a 455%-73% gain, other Layer 1 blockchains have outperformed ETH. The first layer refers to the blockchain as a self-contained base layer. Terra Luna ends 2021 with an increase of 14.823%; Fantom is up 13,549%.
Traditional game companies will increasingly add NFTs
Cryptocurrency this year is largely defined by the massive sales of NFTs, and blockchain games like Splinterlands and Alien Worlds have around 526,000 daily active users, according to DappRadar. Arcane predicts that in 2022, traditional gaming brands will branch out into the NFT space and take advantage of the booming market.
More crypto companies will go public, and many will have valuations above $5 billion
This year saw Coinbase go public on April 14, and it currently has a market capitalization of $72 billion. The top five public listings of cryptocurrency companies scheduled for 2022 are currently valued at over $1 billion. Arcane believes that there will be a number of other companies worth more than $5 billion, such as crypto exchange Bullish, which is currently valued at $9 billion.
Bitcoin ETFs Will Hold Over 1 Million BTC By The End Of 2022
Several bitcoin exchange-traded funds (ETFs) were launched in 2021. They currently hold a combined around 846,309 bitcoins, and Arkan said growth will only continue in 2022.
Related: Data shows that Ethereum whales are dumping Ethereum as price drops below $4,000
Hashrate will become more geographically dispersed
When China banned bitcoin mining, the global bitcoin hash rate dropped sharply, then almost suddenly recovered. Now the United States leads the world in hash rate, followed by Kazakhstan and Russia. Arkan believes that miners will spread more to regions such as Latin America.