January 23, 2022

What will happen to the price of bitcoin in the near future?

What will happen to the price of bitcoin in the near future?

Since mid-November, Bitcoin has not been able to gain a foothold above the $ 60,000 level.On November 26, the correction exceeded 23% of the high at $ 68,789, which was reached on November 10.It is interesting that now the opinions of analysts about the further movement of BTC quotes are divided: some predict an imminent rally for bitcoin, others do not believe that the coin will reach new price highs in the near future.

We figured out why the crypto market collapsed and whatin fact, what is happening now: are we dealing with another correction, which will soon be replaced by rapid growth, or is a bearish trend and the beginning of a new "crypto winter" awaiting us?

What is happening on the crypto market

Since November 10, the capitalization of the entire crypto market has decreased by 12.08% - from $ 2.97 trillion to $ 2.65 trillion.

After rising to an all-time high of $ 69,000,which was reached on November 10, the bitcoin price is constantly decreasing - for three weeks in a row, BTC quotes have been predominantly in a downward movement. At the same time, on November 27, the price of MTC in just one day fell by 10% and briefly dropped to $ 53,500 - these are the minimum values ​​since mid-October.

What will happen to the price of bitcoin in the near future?

MTC price chart for the last month. Source

Traditionally, ETH behaves in a similar way.After the altcoin reached a maximum of $ 4,850 on November 10, it went into a correction and until November 30 traded in the corridor from $ 4,000 to $ 4,500. However, now ether has managed to recover and rise to $ 4,700. Most altcoins also traded in a downtrend throughout November ...

What will happen to the price of bitcoin in the near future?

График цены ЕТН за последний месяц. Source

26 ноября на крипторынке произошла настоящая Black Friday - Most digital assets fell 15-20% on average. Even the metaverse tokens fell in price, although they withstood the correction better than most other assets.

What will happen to the price of bitcoin in the near future?

The fall of the crypto market on November 26. Source.

Over the weekend, the crypto market grew by 8%, almosthaving won back the Friday fall. For the past three days, BTC has been trading at $ 56,000- $ 59,000. Most cryptoassets are also in the green compared to the end of last week.

Reasons for the recent collapse of the crypto market

Let's consider the main reasons for the fall in the crypto market over the past three weeks.

Changes in US tax laws. On November 15, US President Joe Biden signed into law $ 1.2 trillion in infrastructure financing.

$ 28 billion of this amount should bringcrypto companies that are now also treated as taxable brokers. In addition, the country has introduced new reporting requirements for crypto brokers and digital asset operators - now they must report transactions worth $ 10,000 or more to the tax authorities. On the day the law was signed, the MTC fell by $ 6,000, dropping below $ 60,000 for the first time since October. At the same time, the entire crypto market lost 10% of its capitalization.

Also on November 15, Senators Ron Wyden and CynthiaLammis has introduced an amendment to the law that would abolish the tax reporting requirement for blockchain developers and crypto wallet teams. However, politicians proposed similar amendments back in the summer, but they were rejected - it is unlikely this time they will receive approval.

New strain COVID-19. On November 25, South Africa discovered a new, much morecontagious and resistant to vaccines, a strain of the coronavirus dubbed Omicron. Later, the strain was found in Hong Kong, Botswana, Australia and several other countries. The world froze in anticipation of a new lockdown: Great Britain and several EU countries suspended flights from six African countries, and Israel closed borders for foreigners for 14 days.

Omicron-strain provoked a collapse in traditionalmarkets: oil fell by 10% - from $ 80 to $ 72, the S&P 500 index fell by 2.7%, and the Moscow Stock Exchange index - by 3.5%. In these circumstances, it should come as no surprise that traders also dumped risky assets like cryptocurrencies.

Blocking mining pools in China... November 26th, a major Chinese news agencyCrypto portal ChainNews announced the closure. At the same time, local Internet providers blocked the publication's website, as well as the resources of its competitors ODaily and BlockBeats. At the same time, mining pool domains became unavailable.

Obviously, Chinese providers have learnedfind and block miners' connections to the ten largest mining pools BTC and ETH, including F2Pool, BTC.com, ViaBTC and BinancePool. As a result, miners from China can no longer connect to these pools.

This was reflected in the hashrate of the Bitcoin network:since November 18, it has dropped from 167 EH / s to 155.7 EH / s. In October, it became known that the Chinese authorities were considering the possibility of prosecuting those involved in mining. In November, the National Development and Reform Commission (NDRC) said it would continue to fight mining in the country.

Is the situation on the crypto market a correction or a bear market?

So far, this is a matter of interpretation. It is believed that a bear market begins when the price of an asset falls by more than 20%. Within the framework of this point of view, the BTC came close to a trend reversal quite recently.

For example, CNBC analysts believe that the first cryptocurrency is already "Entered the territory of the bear market"... However, we disagree with this approach.On the crypto market, volatility of even 30-50% does not surprise anyone. Much more important is the general direction of price movement - growth or decline - and the duration of the trend. Those who survived the past crypto-winters, when the BTC and the entire cryptocurrency market were declining for months and no one knew exactly when the long-awaited growth, such a fall in the exchange rate does not frighten.

Correction is a temporary deviation of quotes fromgeneral upward trend. That is, the asset remains in the conditions for growth, and prices fell, most likely due to profit taking after reaching the next local maximum. But when there are no drivers for new rallies and the price of the asset does not grow, the market turns to a bearish trend. Unfortunately, it is usually possible to determine the direction of the trend only retrospectively.

We are probably witnessing another correction, and bitcoin will still update its price highs. There are many arguments in favor of this.

This is not the largest correction. The current fall is far from the first for the military-technical cooperation in thisyear. In January, the coin has already fallen in price by 21%, in February - by 22%, in April - by 24%, and in May - by as much as 47% - and this is not an exhaustive list. At the same time, since the beginning of the year, the coin has grown by 100% - the upward trend continues.

What will happen to the price of bitcoin in the near future?

MTC price schedule from the beginning of the year. Source.

The growth drivers are not exhausted by the market. The current fall in bitcoin is caused byfundamental and macroeconomic factors - there are currently no problems in the crypto market that could negatively affect asset prices in the long term. On the contrary, the crypto market is on the rise.

Moreover, according to the Blockdata service, in IVThe Bitcoin network surpassed payment giant PayPal by 66% in the quarter in terms of processed transactions. So, on average, the amount of transactions in the network of the first cryptocurrency in dollar terms amounted to $ 489 billion versus $ 302 billion from PayPal. By comparison, Mastercard processes $ 1.8 trillion on a quarterly basis, while Visa processes $ 3.2 trillion. Blockdata analyst Sam Wouters believes that Bitcoin may well grow to the current scale of Mastercard and Visa by 2026.

The main drivers of the crypto market are dApps, DeFi, blockchain games, metaverse and NFT. These sectors are on the rise and show no visible signs of stopping growth.

The whales are buying back the fall. According to Santiment, during the week when the price of BTC fell below $ 60,000, 59,000 coins were added to the wallets of whales, the balance of which is between 100 and 10,000 BTC, worth approximately $ 3.4 billion.

Interestingly, the fall was also bought out by the companyMicroStrategy, which acquired another 7,002 BTC for $ 414.4 million. El Salvador also acquired another 100 BTC. As a reminder, since September, MTC has been an official means of payment in El Salvador, on a par with the US dollar. Earlier, we also talked about how El Salvador is going to launch the world's first Bitcoin city. During the drawdown, Alex Mashinsky, the founder and CEO of the Celsius crypto lending platform, also announced the purchase of BTC and ETH for $ 10 million. The entrepreneur expects BTC to reach $ 70,000 soon.

At the same time, analysts at Delphi Digital notedthat funding rates (commissions that traders pay each other when trading perpetual futures) remain low compared to the first half of 2021: “This could be a sign that short-term leverage traders are still undecided about the overall trend.". Analysts noted that if we compare this figure with the beginning of the year, then “bullish growth was accompanied by significantly higher levels of funding".

Investors don't panic. The greed and fear index reflecting expectationsinvestors and their willingness to take risks, is at around 34 points out of 100. On November 26, this indicator dropped to point 21, but investors had enough daily candle in 7% to allay the worst fears. It is also noteworthy that even with 21 points, bitcoin managed not to drop in price below $ 53,000. On September 30, when the index last dropped to 21 points, BTC was worth $ 43,800.

What will happen to the price of bitcoin in the near future?

Graph of changes in the index of fear and greed inwithin a month. A month ago, the indicator reached 73 points, which indicated the greed of investors, on November 25, it was 47 points, which indicated "neutral" sentiment. Source.

And here are the arguments for the start of the bearishthere is little trend so far. It is alarming that the bitcoin dominance index has been at the levels of the beginning of 2018 since May - just then the crypto winter began. Strong growth in altcoins, including little-known projects, in 2017-2018 was a harbinger of a long bear market.

However, the current growth of altcoins, most likely, speaks not of a close crypto winter, but of the maturity of the crypto market - not only bitcoin has long-term development prospects.

What will happen to the price of bitcoin in the near future?

Bitcoin dominance index chart for 5 years. Source

Bitcoin price predictions by experts

Consider the forecasts of experts about the future price of bitcoin.

First of all, it should be noted that the firstthe cryptocurrency is unlikely to reach the price peaks of $ 100,000- $ 400,000 this year, which experts predicted for it this spring. The coin also got out of the mainstream Bitcoin valuation models.

For example, an anonymous analyst PlanB, who is also the authorStock-to-Flow (S2F) - the most popular model for forecasting the value of BTC - believes that the coin will not reach the target of $ 98,000. However, he still believes that the S2F model is correct - BTC is close to its predicted $ 100,000, although it will reach this price is late.

Vijay Ayyar, Singaporean top managerLuno crypto exchanges and Katie Stockton, founder of Fairlead Strategies LLC, in the comments for Bloomberg said that they view the recent drawdown of the crypto market as just a temporary correction. Investors should start worrying only if the BTC quotes fall below $ 48,000– $ 50,000. Stockton noted that two consecutive daily closings below $ 52,900 would signal that Bitcoin could roll back to the support level of $ 44,200. But even such a deep correction is not reason for the sale of military-technical cooperation on the part of medium-term investors. Therefore, the trend should remain bullish for the next few months.

Trader, analyst and blogger Ton Weiss believes thatthe BTC still has a chance to reach $ 100,000, but it will take longer than expected. Most likely, this will not happen until the first quarter of 2022. The analyst warned that a deep retracement stage could then come.

Popular trader Michael van de Poppe incomments for The Daily Hodl said that he does not believe that the market will now go into a bearish phase. The expert believes that the assets of the crypto market tend to continue to grow. But most likely it will happen "Lengthening market cycles" - four-year cycles allocated by the S2F model,are no longer valid. Now the situation on the crypto market is too different from what happened in the industry in 2013 and 2017. Van de Poppe views $ 55,000 as an important support level, but also believes that BTC may well fall to $ 48,000.

Philip Swift, cryptanalyst and creator of lookintobitcoin.com, in comments to The Daily Hodl noted that the Advanced NVT Signal indicator is "Deep in the oversold zone, which signals an imminent rise in prices"... Advanced NVT Signal reflects investor sentiment.

The popular cryptanalyst TechDev noted the similarity between the BTC and gold charts and, based on this, predicts the nearest BTC maximum of $ 87,000, and in mid-February - $ 225,000.

“BTC is not very far from trying to re-testing the 21-week exponential moving average (EMA), a time-tested bull market indicator for bitcoin, "popular trader and analyst at Rekt Capital wrote on Twitter

According to BofA Securities' monthly survey of fund managers, most investors expect Bitcoin to continue trading in the $ 50,000 to $ 75,000 range over the next 12 months.

The Bitcoin.org account conducted a Twitter poll on how investors see the price of BTC at the end of November. Majority 35% voted for $ 60,000

None of the Experts Expect a Sharp Failurebitcoin, for example, up to $ 30,000 or less. This is only possible in the event of a strong negative news background. For example, a complete ban on military-technical cooperation in a large country. But even at these levels, the coin is likely to be redeemed by major industry players. Earlier, we have already considered why there may not be a new crypto winter at all.

Moreover, Bitcoin may rise by the end of the yearby 15-20%, that is, up to $ 60,000- $ 65,000. The seasonality of the crypto market will also contribute to the transition to confident growth: in December, usually many digital assets delight investors. A signal that the initiative has passed to the bulls will be an increase in the value of bitcoin above $ 60,000.

What should investors look for

If you have not purchased cryptocurrencies athighs and did not use credit money, then you should not worry about the cryptocurrency market drawdown - most likely, it will soon fully recover. But for short-term investors, a hot time has begun - uncertainty remains on the market and there are no guarantees that a new wave of correction will not collapse cryptocurrency quotes.

Investors' attention must now be rivetedto macroeconomic factors: the development of the situation with the Omicron strain and the introduction of new lockdowns, the raising of interest rates by the Fed and the ECB, regulation of cryptocurrencies in the United States. It is such news that will affect all markets, including the cryptocurrency one.

Where is it more profitable to buy cryptocurrency? TOP-5 exchanges

For a safe and convenient purchase of cryptocurrencies with a minimum commission, we have prepared a rating of the most reliable and popular cryptocurrency exchanges that support deposit and withdrawal of funds in rubles, hryvnias, dollars and euros.

Site reliability is primarily determined bytrading volume and number of users. By all key metrics, Binance is the largest cryptocurrency exchange in the world. Binance is also the most popular cryptocurrency exchange in Russia and the CIS, since it has the largest turnover of funds and supports transfers in rubles from bank cards Visa / MasterCard and payment systems QIWI, Advcash, Payeer.

Especially for beginners, we have prepared a detailed guide: How to buy bitcoin on a crypto exchange for rubles?

Rating of cryptocurrency exchanges:

# Exchange: Website: Rating:
1 Binance (Editor's Choice) https://binance.com 9.7
2 Huobi https://huobi.com 7.4
3 Exmo https://exmo.me 6.9
4 OKEx https://okex.com 6.5
5 Bybit https://bybit.com 6.3

The criteria by which the rating is set in our rating of crypto-exchanges:

  • Work reliability - stability of access to all platform functions, including uninterrupted trading, deposit and withdrawal of funds, as well as the period of work on the market and the daily trading volume.
  • Commissions - the size of the commission for trading operations within the site and the withdrawal of assets.
  • Additional features and services - futures, options, staking, NFT marketplace.
  • Feedback and support - we analyze user reviews and the quality of technical support.
  • Convenience of the interface - we evaluate the functionality and intuitiveness of the interface, possible errors and failures when working with the exchange.
  • final grade - the average number of points for all indicators, determines the place in the rating.

What will happen to the price of bitcoin in the near future?

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