The projection is part of Invesco’s ‘10 improbable but possible outcomes for the 2022’ report that states that Bitcoin might plunge to below $30,000. According to Invesco, the price drop will be a culmination of Bitcoin’s series of bubbles that have occurred in the last two years. The investment giant compared the projected Bitcoin bubble burst to the 1929 crash while suggesting that the recent mass marketing of the asset is losing momentum, considering that BTC has experienced heightened volatility in 2021.
Bitcoin’s 2022 volatility
Last year, Invesco had predicted that Bitcoin would crash to $10,000, but the asset managed to surge in value, hitting an all-time high of almost $68,000. By press time, Bitcoin was trading at $41,800, plunging almost 3% in the last 24 hours. On a year-to-date basis, the digital currency has declined by almost 10%. Despite projecting a bleak future for Bitcoin, Invesco has continued to express its interest in cryptocurrencies by launching several related products. As reported by Finbold, Invesco launched two cryptocurrency-focused thematic exchange-traded funds (ETFs). The products dubbed Invesco Alerian Galaxy Crypto Economy ETF (SATO), the Invesco Alerian Galaxy Blockchain Users, and Decentralized Commerce ETF (BLKC) will offer exposure to global public companies. Besides Bitcoin’s price surge in 2021, the general cryptocurrency market also recorded growth, as highlighted by several metrics like job hirings in the industry. In this line, an analysis by Linkedin indicated that in 2021, job postings with terms “Bitcoin,” “Ethereum,” “blockchain,” and “cryptocurrency” surged 395% in the United States and outperformed the general tech sector.
Focus on crypto regulations
In 2022, the focus on the cryptocurrency industry is also increasingly moving towards the regulatory aspect. Several jurisdictions are increasingly enacting laws to regulate the space. The regulation debate featured in the ‘State of the World’ session at the World Economic Forum’s virtual Davos Agenda, where Indian Prime Minister Narendra Modi called for global cooperation and a common approach towards addressing challenges posed by cryptocurrencies. Elsewhere, the United States is set to explore the ramifications of the energy consumption by cryptocurrency mining operations. The Senate’s subcommittee on Oversight and Investigations of the Committee on Energy and Commerce will hold a public hearing on energy consumption on January 20.
