As one can expect the turbulent events in the global political and economic scene translated into the crypto market. Even though the developments in the crypto sphere continue at a rapid pace, many investors saw significant declines in their investments.
If we take Bitcoin as an indicator, its price has dropped from an all-time high of over $60,000 in April 2021 to $20,225 in July. Other cryptocurrencies are in a similar position as the entire crypto market accumulated $600 billion losses in just a week. However, not everything is as bleak as it sounds, and here, we will look at the main events and predictions during the first half of 2022.
Bitcoin’s bull cycle in 2020 was one of the major reasons why the crypto market went into a bull market phase, and it generated hype around crypto investment. Its well-documented growth in 2020 resulted in a price increase of 170%, while in 2021, it peaked at around $60,000 after Elon Musk made the famous Investment from Tesla into BTC.
But in 2022, there is a stark contrast in Bitcoin’s value. Although we all know that Bitcoin’s rally couldn’t last forever, no one could have predicted that Bitcoin’s price would drop to $20,000. After Tesla sold 75% of its bitcoin holdings in the second quarter, the price dropped to $20,225 in July 2022. The effect was noticeable in the entire crypto market as well, and it left many crypto users wary of the proposed Ethereum merge update.
Given the turbulent events in the crypto sector and the global political events, the business support isn’t on the same level as it was during the bull cycle, but businesses still accept cryptocurrencies especially online businesses. For example, you can easily find a reputable crypto casino operator where you can play everything from online slots to table games with your cryptocurrencies. Otherwise, there are a lot of major brands that still support cryptocurrencies, like Starbucks, Microsoft, Newegg, Overstock, and many others.
Ethereum’s Possible Merge
Ethereum is one of the most successful cryptocurrencies and the second largest one based on its market capitalization. Ethereum’s blockchain network is known for its innovative nature and projects like NFTs, Dapps, and Defi, to name a few.
In terms of the merge, it is a proposed upgrade on the blockchain network of Ethereum, which will complete a much-awaited transition from a proof-of-work (PoW) system to a proof-of-stake. It is expected to happen in September and reduce the supply of Ethereum by 90%. As a result, the price will increase since there will be a scarce supply of Ethereum tokens.
In conclusion, 2022 was quite an eventful year on all fronts so far. Although the crypto market has experienced a lot of changes, it’s an innovative space, and its bear market phase won’t last long. There are many new crypto projects that will further redefine the market, while it’s unlikely for governments, institutions, and businesses to halt the mainstream adoption of crypto.