The Year 2022 Will Be A Watershed Moment In The Crypto Sector, According To XTB

Despite an uncertain start, with markets often in the red, winds of war, and anxieties about shifting monetary policies, the year 2022 might be a watershed moment for the crypto industry.

To back up the thesis of a crucial year, the exchange XTB has compiled its estimates in a study released on January 26th as part of the initiative “Perspectives 2022: how to invest despite inflation and new monetary policy methods.”

The crypto industry in 2022

According to the exchange, 2021 was a significant year defined by an increasing trend in the industry, a trend that is likely to continue in the current year, notably in Italy.

Cryptocurrency use will continue to rise in the Philippines, as it will across the globe.

Walid Koudmani, Market Analyst at XTB, elaborated:

“There is continuous evidence that the crypto phenomenon is now a well-established fact, and governments, central banks, and exchanges are striving to regulate it by 2022.” The most notable example is El Salvador, which became the first nation in 2021 to begin accepting Bitcoin payments, but there is also the instance of a licensed ETF in Canada that purchases Bitcoin on behalf of investors. Many investors anticipate that a comparable ETF will be allowed in the United States by 2022. Then there are the financial organizations, both private and public: PayPal just announced the debut of its cryptocurrency, and the salaries of mayors in New York and Miami are already paid in cryptocurrencies, with many more on the way.

Walid Koudmani went on:

“Blockchain is going to fundamentally alter the financial sector.” We think that the flood of institutional money, together with upcoming government restrictions and blockchain's innate transaction transparency, might lead to the conclusion of the bull market on the one hand, and significant growth of digital currency participants on the other.

In global markets, 2022

There are also worldwide trends to keep an eye on, according to XTB.

Inflation and GDP

A “middle” option seems to be the most plausible. Europe and China will be able to manage the temporary inflation, and it will soon diminish in the United States as well.

The Monetary Policy

Monetary policies will continue to have a significant influence on asset values, as they have since central banks cut interest rates to zero percent.

Indices and markets

The underlying difficulty for markets is the loss of economic stimulus. Liquidity was infused during the Covid; now we must cope with monetary policy tightening. It remains to be seen if this scenario would be followed by a decline in the actual economy.

Gold and oil

Oil production will surpass demand in 2022, perhaps resulting in lower prices. Between the second and third quarters of this year, demand might rebound to pre-pandemic levels.

For gold, 2021 has been a very non-volatile year, but 2022 promises to be more exciting, with negative risks that traders may exploit.