THE world’s leading cryptocurrency bitcoin still has room to fall this year, according to Finder.com’s latest Bitcoin Price Predictions report.
Finder’s panel of 53 cryptocurrency and Web3 industry specialists think bitcoin is set to bottom out at US$13,676 on average in 2022 before ending the year at US$25,473.
Morpher CEO Martin Froehler thinks bitcoin will sink to US$12,000 before recovering to US$40,000 by end-2022.
“It’s reasonable to expect to see more big projects fail in the next couple of months. Retail sentiment is at historic lows due to global economic uncertainty and inflation,” he opined. “Highly leveraged miners who just had to digest the China exodus will capitulate and increase the downside pressure even more. We will see even lower bitcoin prices.”
Bitcoin’s downturn is reflective of the broader market, with 77% of panelists saying “we’re officially in a crypto winter”. The biggest driver behind the crypto crash is global interest rate hikes, according to 70% of panelists. This is followed by Terra LUNA’s collapse (68%), tightening of balance sheets by central banks (47%), and rising inflation (40%).
However just how long the crypto winter will last is up for debate. Only 29% think the market will recover this year while 46% say it will last until 2023 and 24% say it will last until 2024 or even later.
Senior lecturer at the University of Brighton Paul Levy thinks the crypto winter will last until 2H 2023 with bitcoin ending 2022 at US$15,000.
“Bitcoin will likely bounce back in 2023 which may actually lead to inflated expectations and further instability. Much of course depends on world events such as the war in Ukraine and its own ongoing impact on global confidence,” he observed.
Arcane Research analyst Vetle Lunde thinks bitcoin will bottom out at US$13,000 and end the year at US$20,000.
“A myriad of negative forces has crushed the strength of bitcoin … further tightening and unwinding of bad crypto debts will create sobering times onwards and investors should buckle up for more difficulty.”
The panel’s average price predictions for bitcoin have dropped dramatically this year. In April, the panel expected bitcoin to be worth US$65,185 by year-end – meaning the average prediction has dropped by 61% in just a few months.
While still significant, the 2025 and 2030 price predictions have declined less dramatically and are still well above bitcoin’s all-time high of nearly US$70,000.
In April this year, the panel thought bitcoin would be worth US$179,280 by 2025 and US$420,240 by 2030. Today they expect bitcoin to be worth US$106,757 by 2025 and US$314,314 by 2030 or a drop of 40% and 25% respectively.
With bullish longer term price predictions, 50% of Finder’s panel now say it’s time to buy bitcoin (down from 67% in April) with 40% saying it’s time to hold and 10% sell.
However the panel is divided on the role of bitcoin. 42% classify bitcoin as a risk asset and another 42% as store of value with the remaining 15% saying they classify it as neither.
Digital Capital Management managing director Ben Ritchie thinks bitcoin is a store of value and will be worth US$200,000 by 2025 and US$400,000 by 2030. To him, bitcoin can be used as an inflation hedge but on a much longer time scale than gold or other asset classes.
ByteTree chief investment officer Charles Morris thinks bitcoin is a risk asset but still thinks it will be worth US$250,000 by 2030.
“Bitcoin is almost a pure risk asset, almost opposite to gold which is long-term risk free.”
A handful of panelists including University of Sussex professor of finance Carol Alexander think bitcoin will eventually shrink in value.
“Unlike many other established crypto assets, bitcoin is purely speculative. It has no utility value for the development of Web 3.0,” she added. – July 14, 2022
Pic credit: Bitcoinist.com
