The recent colossal crypto crash last May led to a heart-breaking loss of around 830 billion USD in total market capitalization. Cryptocurrencies, including even the blue-chip ones, witnessed a steep fall, unleashing fear and panic about crypto’s future globally. Added to its 17% drop in April, Bitcoin plummeted to a further 20% in price after the crash. Other cryptocurrencies, like Solana, Ethereum, Cardano, and so on, too tanked to great lows. Check out more at Multibank.io.
The crypto market had experienced terribly bearish phases in the past. But as of 2022, owing to the growing popularity of cryptocurrencies, a larger number of people’s money or investments are at stake than what it was previously. It’s self-explanatory why the world is even more concerned about the crypto future now in the aftermath of the crash. The post will delve into discussions about crypto’s future in the latter part of the article. But before that, it must be stressed that most of the experts have already assured a promising future for cryptocurrencies ahead, even after the May mayhem.
What caused the crypto crash?
We will get into the discussions about crypto future but ahead of that, let’s just have a quick look into the major factors that triggered the May crypto disaster.
While there are numerous geo-political reasons which has played a part in the recent crash, the biggest blow was was instigated by a nefarious financial attack on TerraUSD stablecoin that led to a disastrous loss of 40 billion USD in tokens! It consequently resulted in collapse of LUNA too (sister token of TerraUSD) and the whole incident created a kind of domino effect on the whole crypto market.
How does the future look for cryptocurrency after the crash?
Before getting into further analysis about crypto future, here are some stats worth considering-
- Bitcoin is currently rallying over $30k mark after the crash
- Experts have predicted BTC will touch $100,000 by final quarter of 2022
- Ethereum is expected to touch around $4,000 by the end of the year
- Many other cryptocurrencies, like Dogecoin, Polkadot, and Tron, have seen a rise in price since first week of June
- Crypto market is predicted to scale up to around 5 billion USD in total valuation by 2030. It will be 3x of the total valuation of the market currently and certainly projects bright prospects for crypto future
Crypto future not bleak
Well, a small fraction of crypto experts has expressed serious concerns about the future. Some of them have even gone to the extent of stating that the May crypto crash had probably marked the final phase of crypto. But is it only gloom and doom for crypto’s future? On the brighter side, most crypto experts have strongly asserted exciting times for the crypto future ahead. Much to the delight and relief of crypto enthusiasts, the crypto future is largely heading towards thrilling, more volatile, and more adventurous times.
According to most experts, the aftermath of the crash could be mammoth but that doesn’t imply that the crypto market won’t bounce back. Comparing the recent crash with the 2018 bearish market, some people have been alarmed that crypto’s future is probably getting into the “winter” phase or almost a stage of extinction. However, crypto winter will only set in if people start to leave the crypto ecosystem. There should be less corporate and institutional engagement, lesser proportion of investments, and reduced developer activities. But, on the contrary, the crypto market is only witnessing an opposite trend.
With every passing year, the crypto industry is seen commanding more involvement and engagements from corporates, elite institutions, and developers. Last year only, the crypto space received a huge volume of institutional capital worth 17 billion USD. Yes, it happened before the crash but the institutions investing the capital surely had long term goals for crypto future in mind.
On the other hand, some experts have opined that the crypto future is going to be more volatile than ever. Crypto is a risky asset and is influenced by factors like liquidity conditions and interest rates. Cryptocurrencies generally don’t have intrinsic value. When Nasdaq Composite stooped to 30% low, the crypto market tanked by 60%. This trend signals higher volatility for crypto future.
A key defining aspect of cryptocurrencies, “volatility” comes with both upsides and downsides. If the crypto future is predicted to witness more aggressive volatility than ever, odds are, investors will be rewarded with far higher ROI than they are receiving now. The high volatility factor can make an investor a millionaire in just a few weeks, if not days.
When a leading name within the space left the BTC community, the coin prices dipped to 360 USD from 400 USD almost overnight. But in just a few months, BTC rose to a spectacular high of 1,220 USD, thereby touching its first ATH. However, that doesn’t mean one will undermine the higher risks of losses (due to higher volatility) as well-, but the “loss” quotient is just one side of the coin.
Tips for investors
We will wind up the article that will help you to make the most of higher volatility as predicted for the crypto future. You will also find strategies that will aid to protect you from incurring big losses due to the same volatility quotient.
- If you want to make the most of an exciting crypto future ahead, start with small amount for crypto investment
- Don’t invest a large sum at once as you never know what the crypto future exactly holds for you. Divide the sum it into small monthly allotments
- Make sure the amount you invest won’t affect your daily essentials even if there is a 80/90% dip
- Go for a crypto exchange that allows “LIMIT” and “STOP” trading features to prevent huge losses if the crypto future looks gloomy for some time
- Focus more on long-term goals for a more potential crypto future for your portfolio
- Look for meaningful crypto projects that are specifically developed to make positive contributions towards betterment of the planet and its inhabitants.
- Diversify your portfolio and think beyond crypto for investment