The recent crypto market correction, and now consolidation, are making investors jittery as to what could be the next line of action in the crypto space. Well, popular crypto analyst Lark Davis shares seven reasons of optimism as to why the Bitcoin and the broader crypto market bull run can extend well into 2022.
1. SEC Approving Spot Bitcoin ETF
The U.S. SEC has been extremely reluctant to approve a spot Bitcoin ETF citing concerns of market manipulation. However, the pressure is building upon the SEC as even former lawmakers are calling out the securities regulator for their indecision as a result of which a lot of funds have been moving out to overseas locations.
Lark Davis believes a spot Bitcoin ETF will likely arrive in 2022 and the market will continue to stay bullish until then. But he cautions that a bear cycle will start immediately after that. He further adds: “For reference, gold had a strong rally before the spot ETF was approved followed by a year of down prices followed by multi-year mega rally”.
2. Bull run cycles Getting Longer
Davis mentions that the bull run cycles are getting longer as the crypto market matures and more institutional money pours in. Unlike the previous cycles that lasted for 1-1.5 years, this cycle can extend further into 2022.
3. Etheruem Network Upgrade
There’s growing optimism surrounding the Ethereum network transition from Proof-of-Work (PoW) to Proof-of-Stake (PoS). The expected timeline for the same is around mid-2022. Additional updates like triple halving and limited sharding rollout can increase the transactions by 3-4 times on the Ethereum blockchain.
4. Good Scope for Ethereum competitors to Grow
Etheruem competitors like Polkadot (DOT) and Cardano (ADA) are taking up the charge to address the market needs and gaining higher market prominence. Furthermore, other projects like Polygon, ETH L2, Avalanche, and Solana will continue to grow.
5. NFT Market Will Continue to Get Bigger
Along with DeFi, the non-fungible tokens (NFTs) have stormed the crypto market this year and gaining a lot of public attention. Some of the big global brands have been heavily leveraging the power of NFTs recently. Davis believes that NFTs could be the first access point for millions of people to get into crypto.
6. Gaming and Metaverse Will Get Bigger
Gaming and metaverse seem to be the two biggest industries of the next decade. Crypto projects operating in this space will continue to see major adoption over time.
7. Big Money Coming Into Crypto
As per Davis, institutional money flowing into crypto will continue to rise as they realize that this is the best tech investment of the coming decade. However, with inflation growing steadfast, they will have no option but to invest in crypto.
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