It’s been a turbulent year for cryptocurrency, with dramatic price swings practically from the word go punctuating the past six months and a particularly nail-biting crash back in June that saw many holders rushing to sell. Conversely, we also saw a huge buying spree amongst risk tolerant traders who were keen to take advantage of the low prices, and with experts convinced it was only a temporary blip, it’s easy to see why many considered it a wise move.
But now, as the number of new sign-ups to trading apps like Bitcoin-Era continue to report a record number of new sign-ups in 2022, we could be about to see another big shake-up for leading cryptocurrency Bitcoin and alt-coins like Ether and Solana. While July brought with it some promise in terms of a slow but steady recovery, August thus far has ultimately seen the market struggle to maintain its momentum.
Slashed to around 70 per cent of its previous highs, Bitcoin, in particular, had appeared to be bouncing back – and if there’s one thing we know about cryptocurrencies, it’s their ability to do just that. But now, it seems the comeback has stalled, with traders anxiously awaiting a Federal Reserve bombshell. As is the usual pattern, it isn’t just Bitcoin that seems to be struggling to keep its head above the water at present, with Cardano, XRP and the rest of the top ten cryptocurrencies battling outside pressures to try and edge upwards.
Just last week, Bitcoin’s value tumbled once again, with five per cent wiped off its previous price to just $23,000. Now, its direction is looking unclear. What should we realistically expect from it next – and will its competitors fare any better?
For many investors, the landscape is becoming difficult to navigate, with many unsure how to react to this latest blow. It’s clear that the so-called crypto winter isn’t over yet, but industry experts remain confident that the current volatility we’re seeing is temporary.
And now, the world’s largest asset manager, BlackRock, which holds $10 trillion in its current portfolio, has joined forces with major crypto exchange Coinbase to ensure its institutional clients can access Bitcoin, which is a huge milestone for the crypto space and demonstrates the ongoing demand from BlackRock’s clients.
Opening the floodgates to allow institutions access could well be a game changer for Bitcoin and the crypto market as a whole, with Coinbase set to connect to BlackRock’s investment technology platform Aladdin – which handled an eye-watering $20 trillion in assets in 2020 alone – to make it happen. While currently, only Bitcoin is being made available through the partnership, it’s thought that other cryptocurrencies may soon be added, too.
Paving the way for other funds to enter the crypto space, a recent report found that almost 25 percent of fund managers had plans to increase exposure to crypto over the next two years, so this could well be the start of a whole new era in the field.
Add to that the ongoing development of the metaverse, and the increasing adoption of Bitcoin and the like by the luxury market, and while it might not seem like it at the moment, the future for crypto is still looking bright. With more high-end brands and companies than ever now accepting payments for their goods and services, the demand for Bitcoin and its competitors is only set to increase, and as intrigue around the various different uses for blockchain technology also grows, it’s likely to spell good news in the long term.
And as we know all too well, investment is a long-term game. While those hoping to make a quick buck may be better placed continuing to sell off their assets, those who aren’t in a hurry and are prepared to stand their ground could potentially be the ones who benefit longer term, should predictions around the future of crypto prove to be correct.
As another year of uncertainty rages on, the reality of what lies ahead remains to be seen, but for many experienced investors, this is just another temporary bump in the road, and we’ll likely continue to see them stocking up on digital assets while prices remain low.
Disclaimer: Investing money carries risk, do so at your own risk and we advise people to never invest more money than they can afford to lose and to seek professional advice before doing so.
