Cryptocurrencies have had a particularly tumultuous time recently, but a respected market research firm predicts massive gains in the months ahead. In a memo to its investors, FSInsight predicted that Bitcoin will surpass $200,000 in the second half of 2022. That’s a 462 percent increase over the current price of the cryptocurrency.
- According to FSInsight, Ethereum is also due for massive gains this year, with a price projection of $12,000, a 385 percent premium to where it is currently trading.
- It mentioned that cryptocurrencies are becoming increasingly linked to technology stocks. Sean Farrell, head of digital asset strategy said this was due to the “legacy market capital entering the fold.”
- In 2021, venture capitalists poured over $30 billion in crypto investments – tokens and blockchain startups. This was nearly four-times the 2018 record of about $8 billion, in part thanks to investors funding “anything and everything” in crypto. Crypto companies Sky Mavis, DapperLabs, and MoonPay all scored multi-billion valuations in 2021.
- “This is much different from in 2018 where tech stocks were still doing well but Bitcoin sold off along with the rest of the crypto market cap,” said Farrell.
- To hit $200K, Bitcoin would have to draw a new wave of investors, as it did last year, which Farrell believes has a “reasonable chance.” It would also necessitate a market recovery in the second half, but prices are already significantly higher than the bottom of January 24. (though well short of its all-time high).
- Meanwhile, the Ethereum network has seen tremendous growth because of the expansion of NFTs, Web3 applications, and DeFi applications, making it “remarkably discounted,” according to Farrell.
- Multiple Bitcoin price predictions have been made in the past, and the most optimistic have rarely proven accurate, but Farrell and FSInsight are still highly bullish on Bitcoin and Ethereum. They are highly optimistic of the mentioned price targets as long as the government doesn’t get in the way.
- “All assets can sell off and drop another 50% if the Fed hikes 4% tomorrow or next month,” stated Farrell. “But right now, as things stand, the upside to both Bitcoin and ETH is much larger than the downside.”
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