Experts in the crypto industry have different ideas about where cryptocurrencies are going. Some people think the market will stay volatile, but others think it will calm down in the second half of 2022.
Boston Consulting Group (BCG), Bitget, and Foresight Ventures put out a report called "What Does the Future Hold for Crypto Exchanges?" in July of this year. It showed that the crypto economy is here to stay, even though the crypto market has been slowing down recently.
"Just 5 years ago, the top 20 coins looked very different than they do now. Layer 1 tokens are one of these.
They can validate and complete transactions without needing another network. Overall, the crypto ecosystem has grown up a lot. There are now about 10,000 applications, up from only 800 in 2017 "the report said.
The report also said that institutional money has been pouring into the asset class, which has made the market less volatile and more stable.
The BCG report used Coinbase's annual company filing to show that institutional trading on the crypto exchange went from 20% in the first quarter of 2018 to 68% by the end of 2021.
The first half of 2022 will be slow
This year, the market has not made any big gains. Since their all-time highs in late 2021, the prices of Bitcoin and Ethereum have dropped by more than 50%. Even though there have been some small gains in recent weeks, the cryptocurrency market has mostly stayed the same.
In the first half of 2022, the crypto market ran into a number of problems. For example, the Indian government taxed VDAs at a rate of 30%. (Virtual Digital Assets). Also, the 1% TDS (Tax Deducted at Source) may have broken the exchanges' foundations.
CREBACO, a crypto research and consulting firm, told Outlook Money that the trading volume on WazirX was down by more than 82% on July 3 compared to June 30, while it was down by almost 70% and 76% on CoinDCX and ZebPay during the same time period. The situation hasn't changed much so far.
In H2 2022, how stable will cryptocurrencies be?
When it comes to the future of the crypto market in the second half of 2022, some experts think that market volatility will likely stay high, just like it was in the first half.
"There may also be rallies for help. A lot of tokens with flawed or worthless tokenomics may not be around in 2022. The industry will keep moving toward more and more maturity "The founder of a Web 3.0 company, Ajeet Khurana, says this.
But BCG says that only 0.3% of people's wealth is in crypto assets at the moment, while 25% of people's wealth is in stocks and bonds. Penetration that is not too deep shows that there is room to grow.
"The number of people and businesses using cryptocurrencies is going up. But institutions aren't using it as much as they do with traditional investments like stocks, payment technologies, and private equity allocation "the report said.
Kumar Gaurav, the founder and CEO of crypto bank Cashaa, said that the bearish feelings that started this spring have taken away most of the gains made in the crypto market in 2021.
The stock market went down because of inflation, the ongoing war between Russia and Ukraine, new rules, and other things.
"It's hard to say what will happen in the next few months of the year, but Bitcoin and other cryptocurrencies are likely to go up a little bit. As Blockchain developers work on long-term crypto plans, the bull market could start at any time by the end of the year "he said.
Jayjit Biswas is interested in crypto and blockchain. He thinks that the US Federal Reserve's aggressive monetary policies to calm fears of inflation and recession will continue to hurt the crypto market.
Before they can make smart decisions about their future investments in cryptocurrencies, investors will have to wait for clues from global trends.
He said "In India, exchanges need to find a way to work with the government to make trading easier, but the GOI is not ready to do that right now. Instead, they are waiting for the G20 or the US to tell them what to do about cryptocurrencies," .
Even though most people on the crypto market were negative, some experts had a positive outlook for cryptocurrencies. "Based on what's happening around the world, the markets are likely to stabilize later this year.
In bearish markets, projects and companies with stronger fundamentals and that have been focusing on their tech will release new and innovative products that will boost optimism. Also, there are a lot of hopes for the Ethereum network upgrade that is coming up "Anshul Dhir, co-founder and COO of the decentralized finance blockchain company EasyFi, said this.
Sathvik Vishwanath, co-founder and CEO of the Unocoin crypto exchange, said that the first half of the year wasn't a good time for crypto, so it seems like the beginning of a stable market.
He said "The present involvement of corporates has not let the industry get into the bear market. I think the second half of this year will be more stable than bullish unless something crazy happens that makes it go back to a bull market like it was last year ".