Crypto regulations will bring about a corrected and refreshed bull market in 2022, Bloomberg predicts naysayers to join this new asset class.
Proper Regulation Coming
Bloomberg published a report titled ‘Global Cryptocurrencies 2022 Outlook’ predicting the US to embrace cryptocurrency in 2022, partly incentivized by China’s ban.
Proper cryptocurrency regulations will bring about related bullish price implications.
The report identifies Bitcoin, Ethereum, and ‘crypto dollars’ to have a wider adoption and will overcome most ‘wobbles’.
Decline in US Treasury stock bonds yields will shine the spotlight on Bitcoin and Ethereum.
Fiat currency has unlimited supply, but Bitcoin and Ethereum have limited supply.
The US Securities and Exchange Commission’s Chair (SEC), Gary Gensler has been pushing for regulations to reign in Decentralized Finance (DeFi), Decentralized Exchanges (DEX), and stablecoins.
Industry players are mostly in support of regulation as it brings clarity and will likely be the impetus for institutional onboarding.
Crypto Allocations
Bloomberg adds in its report:
“Past performance is no indicator of future results, but when a new asset class outperforms incumbents, naysayers have little choice but to join in. We see this process playing a primary role in 2022, as money managers may face greater risks if they continue to have no portfolio allocations to cryptos.”
Money managers are more at risk if there is no crypto allocation in their portfolios.
Bitcoin and Ethereum will continue to have a mainstay in the crypto ecosystem as others jostle for the top positions.
Shiba Inu and Dogecoin are clear indications that there are plenty of speculations in the crypto space.
Bitcoin’s Bull Market
Bloomberg’s report also addressed the key question in everyone’s mind. Is the macro bull market for Bitcoin over?
The report states that Bitcoin is simply in a consolidating bull market.
It is likely that the key support is around $50,000 and key resistance at $100,000 in 2022.
Bitcoin has more fundamental underpinnings than gold. It is more than just a digital version of gold.
The report also states:
“Bitcoin appears to be on a trajectory for $100,000. We see it as more of a question of time, notably due to the economic basics of increasing demand vs. decreasing supply.”
Ethereum to Lead
Ethereum will lead the wave of digitalization, tokenization, DeFi, fintech, and Non-Fungible Tokens (NFTs).
Although bullish on Ethereum, the report sees the value in Bitcoin, it says:
“Bitcoin is well on its way to becoming the global digital reserve asset, while Ethereum is being adopted as the collateral of the internet.”
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