The crypto market has had a disastrous first half of 2022. Bitcoin, Ethereum, and other cryptocurrencies have fallen by more than half since their all-time highs in late 2021. While there have been some tiny gains in recent weeks, the cryptocurrency market as a whole is relatively stagnant.
Although no one knows, some experts believe cryptocurrency values could fall considerably farther before experiencing a lasting rebound.
Bitcoin reached many new all-time highs in 2021, followed by significant declines and increased institutional buy-in from major corporations. Ethereum, the second-largest cryptocurrency, also set a new all-time peak late last year but fell below $900 in June, its lowest point since the beginning of 2021.
This article will help you decide whether you should buy Ethereum, Bitcoin, or another cryptocurrency now or wait for a while.
Regulations on Cryptocurrency
In 2021, Federal Reserve Chair Jerome Powell stated that he has “no intention” of prohibiting cryptocurrency in the United States, while Securities and Exchange Commission Chairman Gary Gensler has frequently voiced his agency’s along with the Commodity Futures Trading Commission’s functions in guarding the industry.
Consequences of Regulations
Cryptocurrency regulation is contentious, but many experts believe it benefits investors and the sector.
More regulation could lead to excellent stability in the famously turbulent cryptocurrency sector. It also can safeguard long-term investors, deter fraudulent conduct inside the crypto network, and deliver clear advice to allow firms to develop in the crypto market if the correct balance is struck.
Sensible regulation will benefit everyone, according to Ben Weiss, CEO, and creator of CoinFlip. Weiss’s firm is a cryptocurrency purchase platform and a network of crypto ATMs. Moreover, he states that it will give people greater trust in cryptocurrency. However, he believes it’s essential to be patient and get it right.
In already unpredictable markets, regulatory news can impact cryptocurrency prices. Because of market volatility, experts advise keeping cryptocurrency holdings to less than 5% of your whole portfolio and never investing anything you are unwilling to lose.
Firms Adapting to Cryptocurrency
In 2021, mainstream companies from various industries expressed interest in — and sometimes invested in — cryptocurrencies and blockchain. Last year, AMC announced that it would accept Bitcoin payments.
PayPal and Square are also banking on cryptocurrency by allowing consumers to buy it on their platforms.
Tesla accepts Dogecoin transactions and continues to waver on accepting bitcoin payments, despite the corporation owning billions of dollars in crypto assets. Experts believe that this buy-in will increase.
What Does Increased Institutional Adoption Mean for Investors?
While most individuals don’t see the benefit of paying with cryptocurrency right now, more merchants accepting payments may change the scene in the future.
We’re probably still a long way from being a wise financial choice to spend bitcoin on products or services. Still, increased institutional adoption could lead to more use-cases for ordinary people, influencing crypto prices.
Bitcoin’s Future Prospects
Because Bitcoin is an enormous cryptocurrency by market value, and the rest of the economy tends to track its patterns, it is a reasonable forecaster of the crypto market.
Bitcoin’s price rose dramatically in 2021, reaching a new all-time high of $68,000 in November. But then, in 2022, it all came crumbling down.
As a result, Bitcoin and the larger crypto economy have fallen this year due to continued macroeconomic uncertainty, fueled mainly by growing inflation, a weak stock market, increasing interest rates, and catastrophe fears.
Since November last year, Bitcoin has lost well over two-thirds of its value, falling as low as $17,500 recently. Experts are divided on whether bitcoin has reached a bottom. Some believe it has already happened, while others believe bitcoin might fall as far as $10,000 this year.
Keep your investments minimal, and never prioritize crypto investments over other financial goals such as retirement savings and debt repayment.
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