In this article, we will read about cryptocurrency predictions 2022, top cryptocurrency in 2022, best crypto to buy in 2022 for long term
We all know that 2021 was a crazy year for the crypto market and many are wondering whether 2022 will be the same. And many people have their say that crypto will enter a super cycle of successive all-time highs on the other hand others believe that this is the end of the cryptocurrency bubble.
So here are our cry crypto predictions for the 2022 year.
Disclaimer:- This article is not financial or investment advice it’s just educational content. Please contact a financial advisor if you want to get your investment right.
Now first let’s check out the
What is a cryptocurrency and the Best cryptocurrency to invest in in 2022 for the long term?
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Now let’s discuss the Cryptocurrency Predictions 2022.
Cryptocurrency predictions 1:-Usdc Vs Usdt
We predict that in 2022 Usdc will overtake Usdt to become the largest stable coin by market cap. Now at this time, we can see that Usdc’s market cap is half of the Usdt’s. But from 2020 Usdc has been growing way faster than Usdt. Hereby an example we can see that the market cap of Usdc grew by 10× in 2021 whereas the Usdt showed the growth of only 4× in the same period.
Now, this is possible because of few reasons:-
The Usdt’s demand was coming from Chinese investors who are using tether as an on and off-ramp for the cryptocurrency and means to move the money out of the country. The demand for Usdt in the Chinese market has plummeted drastically from the time of China’s crypto crackdown in September 2021 which made cryptocurrency exchanges block Chinese users.
And at the same period, the issuer of Usdt I.e tether has experienced scrutiny from the United States regulators. Now, most of their concerns are related to the assets backing the Usdt in circulation and tether transparency about said assets. Conversely Usdc issued a circle has had a more solid track record of revealing its reserves and though it too has faced its a fair share of scrutiny the fact that circle is also based in the United States has made Usdc more trustworthy stable coins for individuals and institutions alike and last but not the least it looks like circles Usdc could become a synthetic Central bank digital currency as explained by the World Economic Forums recent Crypto Report.
Cryptocurrency predictions 2:- Countries launching their Central Bank Digital Currencies (CBDC)
This prediction pertains to so-called retail cbdcs which will be used by regular people and does not concern wholesale cbdc’s which will be used by select individuals and institutions the devil is truly in the details. Till the time we have seen only two countries to have their success in launching in retails cbdcs.The first one is the Bahamas, which launched itA Sand dollar in October 2020, and the second country is Nigeria whose eNaira launched in October 2021. We can see more countries like China, Uruguay, Ghana, and many more Caribbean islands are in the pilot phase of their CBDCs development, the final step before the final rollout. Although it’s not clear that these countries will complete their projects in 2022, China is expected to launch its digital Yuan after the upcoming winter Olympics in February. From the above countries, we can study that these countries are small and partially if not wholly dependent on US dollars except China. Now in recent times as many of us have seen the record inflation with the dollar has likely accelerated CBDC development around the world as countries seek to gain more control of their money.
CBDC gives the central banks power to create as well as destroy the circulated currency which will help to control inflation. The trade-off is that the central bank will be in control of everyone’s bank balance which both individuals and institutions would resist. Now here is the question of whether the inflation we are seeing is intentional since it is the only way you can convince people to adopt such a dystopian system is to inflate away the value of physical fiat. Many countries are partnering with crypto projects to develop their CBDC infrastructure notably Stellar and Ukraine.
Cryptocurrency predictions 3 -At least one more country will adopt BTC as legal tender.
We have read that right now the only country that legalized Bitcoin (btc) is El Salvador and it adopted bitcoin for the same reason that most countries are developing CBDC’s. They were mostly dependent on Us dollars. El Salvador bitcoin adoption has been a success so far this is because of the inflows of capital the country has seen from the Crypto industry. Other countries in the region are watching Elsalvador’s moves closely. In Latin America, Paraguay and Panama are the most likely to follow in El Salvador, footsteps. Paraguay is very close to creating a comprehensive framework for regulating cryptocurrencies in the country. Though this does not translate to bitcoin adoption personally it does open the door to crypto companies particularly crypto mining companies who will be able to take advantage of Paraguay’s abundant and cheap renewable energy. Paraguay also has a very similar profile to El Salvador they’re both developing countries and dependent on the Us dollars and they both have relatively small populations. This means it’s easier to introduce a change as drastic as a new national currency. Conversely, Panama has a more developed economy and seems to be very comfortable working with the Us dollar probably because it has a better relationship with the United States. As such it’s not nearly as likely that this country will adopt bitcoin in any meaningful manner even though there seem to be a lot of politicians who back the proposals.
Cryptocurrency predictions 4:-The development and widespread adoption of decentralized digital ids
The decentralized digital ids or dids are not at all like the centralized digital ids that many governments are not so subtly pushing for these days. Dids are different because unique identities are often verified without the use of a central party. This identifying information is not stored by a central party and privacy is preserved using zero-knowledge proofs. Did development has historically been slow but has picked up ever since de facto regulators such as the financial action task force started hinting that they would be going after self-hosted wallets in their finalized crypto recommendations last year.
Regulators may crackdown on self-hosted wallets because they could be used for money laundering and the like and the best defense against this is a robust did which preserves privacy while being compliant with the admittedly unjust and unjustifiable rules. This is especially relevant in the realm of decentralized finance or defi which saw significant scrutiny from the regulators last year and will likely see more. The concern there are more or less the same we can’t identify who’s using these defi protocols therefore everyone using them is automatically a criminal. Now as silly as this is the fact of the matter is that the use of dids in defi will make institutional investors more comfortable dabbing in this crypto niche and it will also open the door to the next generation of defi projects by allowing creditworthy users to borrow more with less collateral among other things.
Finally, dids will play a pivotal role in the development and legal recognition of decentralized autonomous organizations or dows whose token-weighted governance structures mean that the future of many cryptos is currently directed by whales instead of a majority of users.
Cryptocurrency Predictions 5:- In 2022 there will be 1 billion crypto holders
Right now there are around 300 million holders around the world and this figure is probably higher given that most people keep their crypto on centralized exchanges and there are also probably millions of people holding shares of physically-backed crypto ETFs in Canada and elsewhere. Now on that note remember to keep all your coins and tokens in your crypto wallet because when your crypto is on an exchange it belongs to the exchange and not to you. The uptick in adoption of Bitcoin and ethereum experienced in 2021 many layer 2s and ethereum competitors have also attracted tens of millions of users this is primarily due to the fees on bitcoin and ethereum being too expensive for the average person and this could be why some layer 2s such as polygon are starting to see more active users than the blockchain they’ve built on.
As far as crypto adoption goes the only thing more important than low fees is accessibility and that is something that many crypto projects have achieved through historic partnerships such as the one between Stellar and Moneygram which could create hundreds of millions of crypto holders on its own another crypto projects such as world coin are also aiming to onboard hundreds of millions of crypto holders by giving away free crypto. Here we need to understand that when something is free it means you are the product and in this case of world coin what you’re giving in return is biometric data. Another factor driving crypto adoption is the slow collapse of the current financial system which is further along in some countries than in others. Turkey is one of the many countries where crypto payments were banned because people were using them instead of their national currency to pay for goods and services and protect their purchasing power from the inflation of the Turkish lira.
Frequently Asked Questions
What is the full form of CBDC’S?
Central Bank Digital currencies
What is the full form of DIDS?
Decentralized Digital Ids
How many crypto holders right now?
Right now there are around 300 million Cryptocurrency holders around the globe.
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