Forex in this article
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Bloomberg analysts see consolidating bull market
Crypto market: demand will exceed supply
Bitcoin on its way to $ 100,000
The market for crypto investments was also characterized primarily by volatility in the old year 2021. It is also the strong fluctuations that many critics repeatedly use as an argument against investing in Bitcoin, Ethereum & Co. However, the Bloomberg experts see an increasing tendency towards easing in the new year. In their “Global Cryptocurrencies Outlook 2022 Report”, the analysts of the financial service take a look at digital assets and continue to have bullish forecasts for the entire market, but especially for the largest representatives among the crypto currencies, Bitcoin and Ethereum.
Bloomberg analysts remain bullish on Bitcoin
The experts trust the crypto veteran Bitcoin to see a further price increase. They describe the price drops in late 2021 as a “consolidating bull market” and do not believe that the cryptocurrency has already reached its peak.
The Bitcoin is on the way to the 100,000 US dollar mark, the analysts continue to write. Bloomberg cites the “economic basis of increasing demand vs. decreasing supply” as the main reason for the positive price forecast. In addition, the adaptation of the crypto currency in the mainstream is advancing. The experts refer in particular to Bitcoin ETFs and futures in the USA, Canada and Europe as well as the approval of Bitcoin as legal tender in El Salvador.
In addition, they assume that the sharp fluctuations in the Bitcoin price will increasingly subside in the future as the market matures. For example, the growth of NFTs could increase the acceptance of cryptocurrencies. And the regulatory situation will also develop in favor of Bitcoin and the entire crypto market: “We expect that the USA will incorporate crypto currencies with appropriate regulation in 2022, which will entail the associated bullish price implications,” says the crypto outlook from Bloomberg continues.
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Positive price outlook for Ethereum too
The number two among the crypto currencies, Ethereum, will also perform positively in 2022. Here, too, the experts see increasing demand with limited supply as a price driver for cybercoin.
As a leader in the wave of digitization, tokenization, DeFi, Fintech and NFTs, Ethereum holds a top position. In particular, the fact that most NFTs run on Ethereum speaks in favor of increasing demand for ETH as the ecosystem expands, the Bloomberg analysts emphasize. While Bitcoin is on the way to becoming a global digital reserve currency, Ethereum is taking over this position on the Internet.
However, the experts do not give a specific price forecast for Ethereum.
2022 as the year of “deflationary forces”
All in all, Bloomberg assumes in its outlook for the new year that Bitcoin and Ethereum are likely to be profiteers of “deflationary forces”, which the lead BI analyst Mike McGlone also confirmed in a tweet:
$100,000 #Bitcoin, $50 #Oil, $2,000 #Gold? 2022 Outlook in 5 Charts – Peaking commodities and the declining yield on the Treasury long bond point to risks of reviving deflationary forces in 2022, with positive ramifications on Bitcoin and gold. pic.twitter.com/j3VNAOCwuz
– Mike McGlone (@mikemcglone11) December 9, 2021
This will be particularly important if the policy of the US Federal Reserve leads to a sustained decline in US Treasury bond yields and low stock yields. “The fact that cryptocurrencies have divergent strengths compared to stocks towards the end of 2021 suggests possible, sustained outperformance of digital assets in 2022.”
McGlone recently emphasized that asset managers who ignore cryptocurrencies in their investments are exposed to “greater risks”, which he justifies with the fact that Bloomberg’s crypto index has risen 1,200 percent since 2019, while the S&P 500 only 90 in the same period Percent: “Past performance is not an indicator of future results, but when a new asset class outperforms established companies, naysayers have no choice but to join in,” continues the Global Cryptocurrencies Outlook 2022 Report.
Finanzen.net editorial team
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