Bitcoin price prediction is always mostly guessing. The volatility of BTC is the reason why some investors love it and the others hate it. Still there is a good chance in 2022 Bitcoin might finally reach $100,000. What happens next?
If you think this question is kinda stupid, think again.
Remember when BTC was worth $5,000?
Would you believe that one day you could buy a brand new Tesla with just one BTC transferred from your wallet?
Well, that’s possible even today with Bitcoin reaching high above $40,000. You can afford a basic Tesla Model 3 right away.
And back in November 2021 with one BTC worth $69,000 you could lay your eyes on Model X with some nice additional options.
Bitcoin price actually changes a lot.
One simple swing of the exchange rate can make you reconsider your life plans for the next couple of years.
An investor with just a couple of BTC on his account can be moderately content (in case it’s $32,000 per each) or extremely happy (if it is $100,000).
No wonder that Bitcoin price prediction has become something more of a religion now.
Having no actually working tools to influence the situation, all we can do is observe and hope for the best. And sometimes pray.
Let’s do a little bit of both now.
Why is Bitcoin price prediction so complicated?
When Bitcoin peaked at $69,000 in late November 2021, it was so easy to gain confidence in its further growth.
Many experts were convinced that by the end of the year Bitcoin price would rise to $100,000.
And forecasts for 2022 were as bright as a new pin.
Analysts easily fell into temptation to name scarily big numbers. Like $200,000 or even bigger ones.
Cold shower came came down on all those optimists just a few weeks later. By the end of 2021 Bitcoin fell to $40,000.
And it went as low as $32,000 on the day when Russia invaded Ukraine. It was February 24.
“Crypto winter is coming”. That message was trending on Twitter and Reddit the next day.
Well, one month later we are enjoying the new steady rise of Bitcoin, with many analysts eyeing $50,000 no later that next week.
And once again, optimists predict Bitcoin to hit $100,00 by the end of 2022.
World economy is stagnating, oil prices plunder and hike a couple of times a week, Russians are avoiding sanctions with crypto, Ukrainians pay for weapons with Bitcoin.
The world is changing so rapidly, that your old-fashioned support and resistance levels ideology is not relevant anymore.
Bitcoin price prediction was always a desperate craft.
Now it has become a shooting at random with your eyes closed and you gun unloaded.
What are Bitcoin price predictions for 2022?
Anyways, we are talking about $100,000 quite seriously.
It’s just March, and we are at $45,000 already with the market at bullish trends.
Data shows large amounts of BTC being withdrawn from crypto exchanges. That’s a clear sign. The whales are not planning to sell.
The timeline might be slower than some of us hoped. But it’s nine months till the end of the year. Plenty of time for bulls to throw out all the energy accumulated since autumn.
Mind the Metaverse. It’s far from total implementation. But big brands are already looking for ways to take a seat in the sun.
You cannot monetize your business in the digital metaverse with fiat money. That’s obvious. So you need to be into crypto altogether. That’s exactly what Nike and Gucci are doing.
The rise of metaverse games, worlds and products leads to the same result. The world is going crypto. And the pace is extremely fast.
Wait, why are we talking about Bitcoin only here? Aren’t there any altcoins?
Yes, there are. But their extreme volatility has already made Bitcoin look like a rock in the middle of stormy waters.
One tweet by Elon Musk can make 10x a coin you’ve never heard before. Bit months later you feel kinda stupid with piles of unneeded coins in your wallet. Just because Musk never tweeted about that coin anymore it is now as useless as an umbrella given to a deep water fish.
Investors are taking Bitcoin more and more seriously.
Through all these years Bitcoin has shown its ability to withstand all the blows of fate.
“When in doubt, zoom out”. That’s what they say. And it’s true. Every fall is followed by a rise to a new peak.
Let’s get back to Bitcoin price predictions for 2022.
Investors should expect a pretty sustainable rise in Bitcoin’s long-term value driven by organic market movement, with the $100,000 threshold in near-sight, predicted Jurrien Timmer, director of global macro at Fidelity Investments.
It’s volatility in the short-term and growth in the long-term, says Kiana Danial, founder of Invest Diva.
What influences Bitcoin’s price prediction
Now it might be a good time to stop for a moment. And dig a little bit into how Bitcoin price predictions are made.
There are lots of economic factors that influence the price of cryptocurrency just like any other currency or investment. But in the case of Bitcoin there are some additional factors.
Let’s take a look at them.
Scarcity
Well, Bitcoin circulation is limited to 21 million. 19 of them are already in circulation. At least theoretically.
Because many experts say about 4 or 5 million are lost forever. We should thank those guys who used to forget their passwords and threw out old laptops in the early days of Bitcoin.
Industry experts consistently point to this scarcity as a big part of cryptocurrency’s appeal.
The demand is increasing while supply is fixed.
Mainstream Adoption
Early days are long gone now. Geeks are still interested in Bitcoin. But they are outnumbered by usual customers who are massively buying and exploring cryptocurrency.
And the flagship of cryptocurrency is Bitcoin.
That’s your first step into the world of crypto, to buy some Bitcoin.
Crypto technology is being adopted at a faster rate than humans first adopted internet technology, experts say.
There is data showing that the number of new crypto wallets in the US increases 50% yearly. It means millions of new users are joining the crypto world.
The acceleration of new adoption could keep pushing the value of Bitcoin higher and higher. Add the aforementioned scarcity and you get prices rising.
State regulation
That’s a tough one.
Federal officials have made it clear in recent months they are paying attention to crypto.Industry professionals say that the government’s wish to take control over crypto might actually hurt the prices.
President Joe Biden recently signed an infrastructure bill requiring all crypto exchanges to notify the IRS of their transactions. The government also said stablecoins should be subject to federal oversight.
Anonymity was one of the chief merits of crypto. And with all those phantom menaces of its loss Bitcoin and other crypto might eventually lose some of their attractiveness.
But that threat should not be overestimated, experts say.
Many people don’t care much about government oversight.
They just want to be a part of the brave new world of crypto and that’s it.
Mining Cycles
There is one more aspect not to be forgotten.
Bitcoin prices are influenced by a cycle known as halving.
It’s complicated and algorithmic in nature, but in essence halving is a step in the Bitcoin mining process that results in the reward for mining Bitcoin transactions getting cut in half.
Of course, miners are affected by it first of all.
But halving influences the rate at which new coins enter circulation.
It’s a kind of scarcity factor, though on a slightly different scale.
If mining gets less rewarded, it’s becoming less profitable. Some miners leave the business. The mining rate slows down as more investments are needed to keep mining.
Historically, halvings have correlated with boom and bust cycles.
What happens when Bitcoin reaches $100,000
Assuming, we are taking this Bitcoin price prediction seriously, first thing you might think of is selling.
Well, let’s say you bought some BTC at $20,000 or even at $40,000.
Selling at $100,000 looks like a stunning opportunity.
And surely it is.
And I am not going to be that guy who told you not to buy at the bottom and sell at the top.
But try to think of it in a slightly different way.
As with any investment, financial planners and other experts advise against letting Bitcoin’s price fluctuations lead you to emotional decision making.
Because of the volatility experts recommend not investing more than 5-10% of your overall portfolio in cryptocurrency.
And of course you should never invest at the expense of saving for emergencies and paying down high-interest debt.
The path to long-term wealth and saving for retirement is most often successful for people with diversified investments and never made radical decisions driven by emotions.
Have I already mentioned the ‘when in doubt, zoom out’ strategy?
Bitcoin is volatile in short terms, but is steadily growing in the long run.
That leads to a conclusion that a set-it-and-forget-it approach makes sense.
Everyday trading makes sense only if you are a professional. Or at least pretend to be one.
A typical crypto investor trying the muddy waters of crypto has to be cautious and patient.
Well, selling at $100,000 might sound a good idea if you bought at $40,000. Especially, if you utterly need a new house or your wife will just die if there is no new red Porsche in front of your fancy house.
It’s just the same story as with $10,000 vs $2,000.
We never actually know where that perfect peak is when you need to sell immediately.
Of course in that $100,000 to $40,000 situation you cannot possibly lose.
But what if Bitcoin climbs to $200,000 half a year later? Chances are your wife will just kill you with that Porsche. Unless you kill yourself first acknowledging that selling for $100,000 was the biggest mistake of your life.
Will Bitcoin finally change the world?
Aside from personal investment stories, Bitcoin price prediction at $100,000 would be huge news.
Let me just name a few consequences such a record would have:
- Bitcoin would immediately become the new gold standard for long term investors;
- Also it would become a popular alternative to these blue chip stocks everybody buys to make sure the money is safe;
- More and more people would want to buy some Bitcoin even at $100,000. Don’t be surprised, you are willing to buy at $45,000 knowing it might climb to $100,000. People would hope to see $200,000 so they will keep buying even at $150,000;
- This demand will add up to the scarcity I mentioned above. Next thing you know, the price will rise again. It’s simple. More people will be willing to buy something that is getting more and more scarce;
- The crypto would become the Big Thing. If Bitcoin is $100,000 rest assured that ETH will be at $30,000 at least. Other altcoins will be in demand too. Harsch times for fiat money, of course.
Source: Time, The Motley Fool
