Posted in:

Cryptocurrency predictions: short term, mid term, long term


In recent years, cryptocurrency has been receiving increasing attention, not only from investors but in the mainstream media as well. But what exactly are the types of cryptocurrency receiving all this attention, and what cryptocurrency market predictions have experts shared?

Cryptocurrency predictions: short term, mid term, long term: Summary table

📈 How did crypto perform last year?In 2021, the value of cryptocurrencies surged by almost 70%. As investors flocked to the digital currency, they drove up its price
🤑 How will crypto perform in the short term?Following the record highs achieved by cryptocurrencies, some experts believe that the value of these digital currencies is in for a sharp decline, though not everyone believes that crypto is set to crash in 2022
🔮 What do experts predict for crypto in the long term?To predict its long term future performance, experts look at how it has performed in the past, suggesting that investors interested in crypto opt for a long-term approach and avoid getting skittish over the ups and downs of the short-term

Cryptocurrency is a digital form of currency, measured in tokens or coins, that is exchanged and distributed via decentralized networks using blockchain technology, enabling digital payments without the need of third-party intermediaries. The currency is secured through complex cryptography, which makes it nearly impossible to counterfeit and are bought and sold through specific exchange platforms or “mined” via computer processing.

While tens of thousands of different cryptocurrencies have been developed since they were first conceptualized, Bitcoin was the first of its kind and has become the most commonly referenced cryptocurrency and valuable form of cryptocurrency, as well as the informal standard of comparison of these currencies.

This type of currency has received a lot of media attention and become increasingly popular among investors, especially in recent years, and financial experts maintain that in the coming years, this technology will disrupt the financial industry and change the way we pay for things, especially as they become increasingly mainstream, though they have been criticized in the past for their volatile nature.

Cryptocurrency price prediction

Because the cryptocurrency market is still so new, it is difficult to provide price predictions with a high degree of accuracy, and as such, there are diverging expectations among experts of how the value of this new form of currency will develop. To make reliable predictions on cryptocurrency in the short and mid terms, we inevitably need to look back and evaluate how they have performed in the past.

Last year’s predictions vs occurrences

In 2021, we saw a surge in the value of cryptocurrencies, from Bitcoin and Ethereum to Cardano, increasing in value by almost 70% since the beginning of the year, with many people investing in the currency, driving up the price. For many, this boom in price was in part due to rising inflation, an inevitable outcome of the monetary policies of central banks in response to the COVID-19 pandemic. Because of the way the coins are generated – through complex computing operations that require an immense amount of energy, cryptocurrencies are resistant to the negative impacts of inflation, making them another attractive tool for investors to hedge against a decrease in the value of assets because of inflation.

In addition to the surge in crypto investors, 2021 also saw the groundwork laid for greater institutional adoption of the currency, as more major multinationals, and even some countries, began accepting payments in cryptocurrencies like Bitcoin, as well as the approval by the SEC of trade of an ETF linked to Bitcoin on a major US exchange and increased interest on the part of financial market authorities in its regulation.

However, while cryptocurrencies have reached these all-time highs, in the same year crypto also saw significant oscillation in the price of cryptocurrencies, and has shown to be volatile and influenced by the media, or in some cases even social media, begging the question, how will the currency perform moving forward?

Cryptocurrency short term predictions for 2022

Following the record highs achieved by cryptocurrencies like Bitcoin and Ethereum, some experts believe that the value of these digital currencies is in for a sharp decline in the months to come. Already in 2021, following its peak in November, the value of cryptocurrencies are down by nearly 30%. While crypto is known for being volatile, some experts believe that history is doomed to repeat itself, with a sharp fall in value, just as it did in 2018, losing the gains made last year.

Though not everyone believes that crypto is set to crash in 2022, since some of the greatest risks to the value of the currency, like changes in monetary policy have already been decided and interest in crypto continues to increase among investors and popular culture, as evidenced by the creation of new types of cryptocurrencies like NFTs.

Cryptocurrency future predictions

Moving forward, in the next few years, experts believe factors like regulation by financial market authorities and increased adoption of cryptocurrencies by major multinationals to be key factors contributing to greater stability in the performance of its price.

In terms of cryptocurrency regulation, though some countries have flat out banned the use of crypto, because of its affiliation with financing illegal activities, U.S. regulatory authorities have shown greater interest in adopting regulation.

In an infant market like that of cryptocurrency, increased regulation can help provide greater stability in the value of the currency by making cryptocurrency safer for investors. Currently there is a lack of clear guidelines on how exchanges are reported and how to declare capital gains made on investing in virtual currency. Increased regulation also means that regulators will get a chance to “pop open the hood” of some cryptocurrencies to evaluate the soundness of the collateral to which they are linked, making for greater confidence among investors.

WE MAKE MONEY SIMPLE FOR OVER 80,000 INVESTORS

Find your ideal ISA today

Start now

Of course, in these cases, announcements for increased regulation can negatively impact the price of assets in markets that are already volatile, such as in 2008 when the collateral behind the mortgage crisis came under scrutiny, followed by aggressive repricing.

Ultimately, however, an increase in regulation is regarded by experts to be a positive development for the industry, since it creates greater confidence in crypto and makes it more attractive to potential investors.

Mid-term cryptocurrency predictions 2025

But further down the line, how is the industry likely to develop? What are the cryptocurrency price predictions 2025 has in store? If the trend of institutional adoption and acceptance of crypto among countries, and mainstream companies that took hold in 2021 continues in the coming years, the industry will continue to grow.

In 2021, major companies have announced they will begin accepting payment in Bitcoin, others have accumulated billions in crypto assets, while companies in financial technology industries have announced they are developing means to allow buying of crypto through their platforms. And it seems that this trend is only set to continue in the foreseeable future, as the interest of the general public in cryptocurrencies continues to climb, and new types of cryptocurrencies are developed.

Though paying for things with cryptocurrency isn’t feasible for most people in the short term, an increase in mainstream companies that consider cryptocurrency an acceptable form of payment could make its use more commonplace, with positive outcomes for crypto prices – the more applications that it has, the more likely the demand for it, and consequently its value, will increase.

Long term cryptocurrency predictions 2030

While it’s difficult to provide with any degree of certainty a cryptocurrency forecast on how it will perform in the long term, since it is still a burgeoning industry will surely undergo changes in terms of regulation and diffusion among the general public, we can turn to the past to get an idea of how crypto may perform in the future.

As the largest and leading cryptocurrency, Bitcoin is often used as a proxy to predict how the rest of the industry will develop, since the rest of the market seems to follow in its footsteps. Since its creation over a decade ago, Bitcoin has had several price surges followed by sharp dives in price, though over the long term, it has grown and increased in price considerably.

Thus, for those who are considering investing in cryptocurrencies, experts recommend investing through a long-term perspective, and avoid reacting emotionally over the ups and downs of the short-term, as this will result in losses on investments. But no matter what experts predict, the truth is that no one really knows how things will play out. That’s why it’s important to invest only what you are prepared to part ways with, and try to build long-term wealth by investing in more conventional asset classes.

FAQ

What is cryptocurrency?

Cryptocurrency is a digital form of currency, measured in tokens or coins, that is exchanged and distributed via decentralized networks using blockchain technology, enabling digital payments without the need of third-party intermediaries.

What is blockchain technology?

Blockchain is a distributed, unchangeable database that makes recording transactions and managing assets in a corporate network much easier. A tangible asset (a house, car, cash, or land) can be intangible (intellectual property, patents, copyrights, branding).

Why should I invest in crypto?

Financial experts maintain that in the coming years, cryptocurrencies will disrupt the financial industry and change the way we pay for things, especially as they become increasingly mainstream.

Match with a portfolio and start investing today

Simple, efficient and low cost, Moneyfarm helps you protect and grow your money over time.

Sign up with Moneyfarm today to match with an investment portfolio that’s built and managed to help you achieve your financial goals.

Make your money work harder for you, without breaking a sweat.

Get started

As with all investing, your capital is at risk. The value of your portfolio with Moneyfarm can go down as well as up and you may get back less than you invest.