Bitcoin Prediction 2023
Why Bitcoin Crash? In perhaps one of the worst years the sector has ever experienced, the reputation of cryptocurrency leaders suffered significantly, yet some writers for Seeking Alpha warned investors of the impending downfall.
High-profile bankruptcies, such as the FTX debacle, as well as a generalized risk-off attitude brought on by rapidly rising interest rates and worries about the state of the economy, hurt the cryptocurrency market.
The price of Bitcoin (BTC-USD), the cryptocurrency market’s symbol for the general public, fell by nearly 65% in 2022.
Numerous pro-crypto arguments that propelled its rise in past years, such as Bitcoin’s usefulness as an inflation hedge and the notion that a market can function well without significant regulatory control, came under heavy examination.
These predictions for the cryptocurrency crisis in 2022 were chosen by the editors of Seeking Alpha.
Understanding Crypto Winter was on its way
With a residual sense of exhilaration, Crypto entered 2022. The price of Bitcoin (BTC-USD) peaked at about $69K in November 2021. By the end of 2021, it had dropped significantly, but as the year started, it was still substantially above that peak. However, several experts anticipated turbulent times.
Clem Chambers, a contributor to Seeking Alpha, predicted that Bitcoin crash due to cryptocurrency was on the verge of crashing in January. This would be one of the industry’s many abrupt declines. He projected that a jump to $20K territory would occur fast if the price fell below $40,000. (Even this would turn out to be excessively pessimistic as BTC-USD would eventually fall below $15.5K.)
Chambers based his forecast on the observation that “retail is bored of crypto” as 2022 dawned, along with technical warning indicators. In addition, he correctly foresaw that “in the current market, Bitcoin is not an inflation hedge.”
Early in the year, BiotechValley Insights added its voice to the pessimistic ones. A perfect storm of unfavorable factors, according to the analyst, will destroy the inflated price of the cryptocurrency industry during the year.
BOOX Research, another SA contributor, predicted choppy waters for the cryptocurrency market in January.
BOOX emphasized in its defense that the way market players viewed Bitcoin was comparable to how they viewed “high-growth momentum technology stocks and more speculative parts of the market” —a relationship that would probably last.
This occurred at a time when, according to BOOX, “macro worries, like rising interest rates and concerns about the soundness of the economy, have added to unfavorable sentiment about cryptocurrency.”
Making it through 2022… and Looking to 2023
Many elements of this “perfect storm” that BiotechValley Insights and others prophesied later came to pass.
One of the victims was TerraUSD (UST-USD), the third-largest stablecoin by market valuation. In May, the cryptocurrency’s peg to the dollar was broken, driving Bitcoin (BTC-USD) as low as $30,000. Its sibling coin, Luna (LUNA-USD), likewise saw a decline in market value.
There was yet more destruction to come. The market suffered in the second part of the year as a number of well-known crypto-related businesses suffered from liquidity problems, many of which declared bankruptcy.
The most notable of these was Sam Bankman-FTX Fried’s (FTT-USD) collapsing, which was formerly hailed as a stabilizing factor in the sector. The ripple effects of the crisis in the industry are still being felt today.
Chambers claimed “the likelihood of seeing $15K this year is high” before the collapse of FTX. After the FTX crash, Bitcoin (BTC-USD) fell to a low of around $15.5K in November, a 77% reduction from its all-time high of $69K in November 2021.
The bear market drove cryptocurrency miners to sell off their holdings and Bitcoin reserves, and some even had to scale back their operations or declare bankruptcy. If Bitcoin (BTC-USD) dropped to $10,000, SA writer Made Easy-Finance sounded the alarm that miners would soon meet their demise. Bitcoin miners run the danger of going bankrupt.
We discovered that a mining company’s entire all-in costs range from $25K to almost $40K per BTC “It read.
But cryptocurrency bulls remain upbeat. The FTX scandal, according to BOOX Research, may signal a required reset for the cryptocurrency industry before a resurgence, but Knox Ridley is still bullish due to growing bitcoin acceptance.
Even among those who predicted a significant decline in 2022, this short-term bear, the long-term bull mindset was prevalent. Even if Bitcoin drops below $10,000, Chambers said in his article from January establishing the near-term bear case for the cryptocurrency, “it’s still going to hit $100,000 by 2025/2026.”
However, many people think that the cryptocurrency rebound may never happen.”
Fundamentally, I think the market for Bitcoin and other cryptocurrencies should never have expanded to what it is now. Its downfall has already caused a great deal of suffering. This anguish will very certainly persist, Daniel Jones said.
See why SA columnist Jeremy Blum thinks the gold investment is preferable to cryptocurrency investment.