Mikhail Karkhalev, financial analyst at Currency.com cryptoexchange, on the low probability of an imminent start of a long-term market correction and which sectors remain promising in the current environment
The message contains information about the movement of the market, is not an investment research, should not be considered as investment advice and is a subjective point of view on the subject of the message of the author of the material. Past performance is not a reliable indicator of future price movements.
The bitcoin rate on the Currency.com crypto exchange continues to decline after it set a historic maximum at $ 69 thousand on November 10. Over the past two weeks, the cryptocurrency has fallen in price by 17%. As of November 23, Bitcoin is worth $ 56.4 thousand.
A long-term correction of the crypto market can begin only if the world economy is actively recovering, inflation will subside, the world's leading central banks, including the US Federal Reserve, will begin to tighten monetary policy. And, of course, as soon as the large holders of BTC and ETH begin to gradually get rid of some of their assets. The reasons for the possible correction of the cryptocurrency market can be attributed to the inflow of bitcoins and ether to exchanges, which usually leads to subsequent sales. None of the above factors are on the market yet.
I believe that the situation will clear up by mid-December, so there are chances for a recovery in Bitcoin and a renewal of the high back in 2021. Inflation data will be released on December 10, and the Fed will meet on December 16. Plus, it’s the end of the year, and some specific statements are expected from the Fed, rather than vague “maybe”, “we'll see,” and so on. The Fed seems to be quite happy with the current inflation situation. Temporary high inflation in the United States will stimulate the economy to develop and bring additional money to the treasury. But this is just my guess.
Throughout the year, when Bitcoin grew on the Currency.com crypto exchange to $ 30K, then to $ 40K, then to $ 58K, I repeated the same thing: given the more powerful capital inflow in the current growth cycle, the deficit bitcoin in the market, the growth in popularity and the number of participants in the market, bitcoin has not yet exhausted its full potential for growth. This also includes everything that is said above: the situation in the global economy, inflows / outflows from exchanges, and so on. This is a very subjective assessment, but I believe that there will still be an update to the maximums.
In my opinion, bitcoin may well grow to $ 80-85 thousand. It is unlikely to make it before the end of the year, but there are good chances by the end of the first quarter of 2022. I don’t presume to talk about higher marks yet. The markets are very unstable now, after the crisis.
Of course, there will be altcoins that will outstrip Bitcoin in dynamics, this has always been the case. At the same time, it does not matter at all whether Bitcoin will rise or fall. There will always be altcoins that are ahead of it in dynamics and have an inverse correlation.
Among the sectors that hold the greatest promise at the moment, I would highlight DeFi and GameFi. Among decentralized projects, Uniswap, Chainlink, Polkadot and Solana are of interest – in my opinion, these are the most promising projects now in terms of future development, and not in terms of getting crazy X's. As for the hype, "pumps" and "x", you can pay attention to the metaverse, which is likely to become the new hype direction after Mark Zuckerberg announced the change of the name of Facebook to Meta.