Amidst the Falling Market, Experts Are Talking About Prospects for Bitcoin (BTC) and Altcoins in 2022

Amidst the Falling Market, Experts Are Talking About Prospects for Bitcoin (BTC) and Altcoins in 2022

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Analysts make revisions of the most important milestones in 2021 and predict the development of the market in 2022.

The year of 2021 can be truly divided into two halves, that differ in trends and leaders in the cryptocurrency market. Bitcoin has delighted investors with explosive growth in the first two quarters to a new record of $65K. In May, investors began to take profits, prices went down. At the same time, the topic was risen about the lack of environmental friendliness of bitcoin. Some statements appeared in media that electricity from coal-fired power plants is used for network maintenance. And an additional negative factor was the ban on cryptocurrencies in China.

In the middle of the year, bitcoin consolidated at around $30K. But investors did not get out of the market but switched to altcoins. Some altcoins have surpassed the king of cryptocurrencies in terms of profitability since the beginning of 2021. Tokens for DeFi projects and decentralized exchanges like Uniswap (UNI) and Aave (AAVE) grew rapidly. Serious competitors of the leading altcoin have appeared, the cryptocurrencies of these platforms, for example, Solana (SOL), Polygon (MATIC), and others have grown significantly too.

Fiat funds poured into functional DeFi projects. According to the tracker DeFi Llama, there are already several projects in which up to $20 billion are locked in each, for example, Convex Finance (CVX), Curve DAO (CRV). These tokens can grow by hundreds of percent.

There is a high probability that the “altcoin season” will continue in 2022, and bitcoin will continue to lose its market share. However, it will not collapse, experts say. This assumption is supported by the fact that long-term hodlers are selling record low amounts of BTC, as noted by research firm Glassnode.

Even after the all-time high was renewed, hodlers were in no hurry to sell bitcoin. This means that investors believe in the continuation of the bullish trend, despite the volatility. According to Glassnode, bitcoins sold in the final weeks of the year were bought at lows between June and September 2021.

Big players stopped taking profits by the end of the year, says Raoul Pal, founder, and CEO of Real Vision, a specialized media. Earlier, he stated that the increased volatility in the cryptocurrency market was caused exactly by the actions of institutionals that took profits.

Why are big investors driving the market? The expert believes that the reason is high inflation in the United States. Retail investors don’t have money enough to invest in cryptocurrencies. Before Christmas, the institutionals sold part of their BTCs in order to keep the profits. But that doesn’t mean they don’t trust cryptocurrencies. On the contrary, from the first days of 2022, they will continue to play, says Raul Pal and notes:

– The probability is that next year ends up being a strong start.