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Will it test new highs?

Will it test new highs?
Written by publisher team

The past year has seen increased volatility in the price of Bitcoin (BTC), as the world’s largest cryptocurrency surged to all-time highs multiple times, followed by sharp corrections. The currency has yet to recover from its recent sell-off in November.

The most bullish forecast was for Bitcoin to head towards $100,000, but the coin missed expectations in the fourth quarter and fell below $50,000 at the end of 2021, although it managed to post a 59.7% return for the year.

While the use of bitcoin as a payment method expanded in 2021, it remains mostly a store of value for investors looking to diversify their portfolios beyond stocks, bonds and other assets. Bitcoin also attracted unprecedented interest from institutional investors in 2021, which was accelerated by the launch of the first Bitcoin-traded fund (ETF) in the United States in October. El Salvador became the first country to adopt bitcoin as an official currency, and later announced plans to build a “Bitcoin City” powered by geothermal energy from a volcano.

What are the prospects for bitcoin as an investment in 2022? In this article we take a look at the latest Bitcoin predictions.

Bitcoin activity reaches record levels

Bitcoin saw a historic price movement in 2021, starting with the year at $28994.01 after breaking the all-time high of $20,000 in December 2020. The bitcoin price trend was higher during the first quarter, reaching $50,000 in February and after a short dip. about height. Again in March and April to reach $64,863.10 on April 14, as bullish sentiment took hold. Then the market crashed in May, plummeting during the spring and reaching a low of $29,360.96 on July 20.

Bitcoin rallied again over the summer, retracing back above the $50,000 level in September as a brief pressure pushed the price higher. After dropping to $39787.61 on September 21st, Bitcoin surged again in October, reaching a new all-time high of $68,789.63 on November 10th, a peak that is still standing.

Despite the decline, the thirteenth anniversary of the creation of the first block on the Bitcoin blockchain at the beginning of January 2009 saw the hash rate of the Bitcoin network – indicative of its processing power – hitting a new all-time high of 207.53 million tera hashes per second on 1 January, data from YCharts shows.

Bitcoin network hash rate

The number of bitcoin holders also reached new highs in 2021, according to data from analysts at Santiment. The previous record was set on December 14, 2017, when 1.28 million unique bitcoin addresses were sent or received. The number of daily active addresses reached a new high of 1.34 million on January 6, 2021, when the bitcoin price reached $36,000, and hit another new high of 1.36 million on April 15, the one-day record.

“With its average daily addresses at 989,000 — or just under 1 million addresses/day — this was also the strongest year yet for Bitcoin address activity,” Santiment analysts said. “Towards the end of the year, Bitcoin is once again showing negative momentum for the network in the short term, posting a 38% drop in daily active addresses over the past three weeks. If history is to judge, we should see a new wave of wholesale activity on the Bitcoin network to be We are fully convinced that another sustainable historical high can be obtained.”

Institutional interest in bitcoin grew during 2021, as asset managers sought to diversify their client portfolios in the cryptocurrency markets. Digital asset investment products saw $9.35 billion in inflows as of December 17, 2021, with bitcoin worth $6.36 billion, according to data compiled by CoinShares. Total Assets Under Management (AUM) was $63 billion, and Bitcoin was worth $40 billion.

While the advent of Decentralized Finance (DeFI) has centered around the Ethereum blockchain, it has enabled the tokenization of assets, including BTC. Users can now deposit BTC on decentralized exchanges to earn a return by providing liquidity. The number of bitcoins tokenized on the Ethereum blockchain increased during 2021 to 323,000, from 141,000 at the end of 2020, according to Sanitment, representing 1.7% of the total BTC supply.

Can Bitcoin return to its previous peak in 2022 or will the price remain under pressure? What do analysts’ forecasts indicate?

Bitcoin Price Prediction for 2022 and Beyond

Software company MicroStrategy has made bitcoin a major asset on its balance sheet, holding a total of 122,478 BTC, as of December 10. In a presentation to investors in December 2021, the company was bullish on its Bitcoin outlook, noting that it is “still early” in the price cycle, as the cryptocurrency is “a very small part of the [the] Global assets” and increased dependence will continue to drive the price higher.

The presentation cited BTC price analysis from investment firms including Ark Invest, Citibank, Fidelity and JP Morgan, which issued long-term price predictions in the range of $100,000 to $500,000.

Bitcoin Price Prediction: Long-Term Views

In the short term, the $50,000 level is once again becoming a key level for Bitcoin to hit. On December 30, analysts at Dutch investment bank Saxo noted technical support at $46,000 down to $45,000, with resistance at $50,000 up to $53,000. “There remains a tendency towards higher levels and we look for any dips to be limited. The risk/reward is sufficient to call a long position.”

Analysts at Santiment are cautious about the near-term outlook for future bitcoin prices, noting: “Overall, it appears that we are seeing a strong transition to dormancy for many BTC holders, which could present an obstacle to a strong price recovery — at least in the very short term.” One possible exception to this is Bitcoin’s NVT ratio, which continues to flash green.”

The NVT ratio acts as a price to earnings (P/E) ratio. It is calculated by dividing the market capitalization of Bitcoin by the number of unique BTC moving on the chain per day.

“Bitcoin’s NVT ratio continues to look almost bullish at the moment, although this is mostly due to lower market capitalization rather than any recent uptick in overall on-chain activity,” the analysts wrote.

Bitcoin Technical Show and Price Targets for 2023, 2025 and 2030

CoinCodex technical analysis is bearish at the time of writing (January 3) with BTC trading around $47,277, with 16 indicators showing “sell” signals compared to 12 bullish ones.

The exponential moving averages (EMA) and the 10-200 daily simple moving averages were bearish, while the 5-day EMA and the 5-day SMA were bullish. The Hull Composite Moving Average was giving a “buy” signal, while the Volume Weighted Moving Average was bearish. The data showed that CoinCodex had a bitcoin price target of $48,819 by January 8, an increase of 3.29%.

Wallet Investor’s Bitcoin forecast for 2022 was bullish (as of January 3), and predicted that the price would trend upwards during the year to break the previous high in October and reach $77,430.10 at the end of 2022. Over the long term, the prediction algorithm depends on the prediction site that The price of BTC will rise to $108,976 by the end of 2023 and $171,285 by the end of 2025. By January 2027, the price could reach $203,020 as the data showed.

DigitalCoin’s BTC price is forecast to average $65,388.13 in 2022 and $102.588.57 in 2025, rising to $203,732.19 in 2029 with a peak of $212,478.84 based on historical data.

Bitcoin’s long-term forecast from the price forecast was the most optimistic, as it predicted that the price will average $200,215.41 in 2025, up from $68,538.84 in 2022, and rise to $1,883,603.43 in 2030. .

It is important to keep in mind that the cryptocurrency markets remain very volatile, making it difficult to accurately predict the price of a coin within a few hours, and even more difficult to provide long-term estimates. As such, algorithm-based analysts and forecasters can get their predictions wrong.

We always recommend that you do your own research, and consider the latest market trends, news, technical and fundamental analysis and expert opinions before making any investment decision. Keep in mind that past performance is not a guarantee of future returns. And never invest more than you can afford to lose.

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