Many believe that 2021 is the heyday of cryptocurrencies, however, high expectations of 2022 have led others to believe that what happened in 2021 was just the tip of the iceberg.
One of those from the latter group is Chris Klein, COO and co-founder of Bitcoin IRA, an IRA digital asset technology platform. Speaking to The Fintech Times, Kline examines how cryptocurrencies will grow this coming year:
The term “huge” hardly reaches the tip of the iceberg when describing this year’s events in the world of Bitcoin and other cryptocurrencies. When bitcoin – the first widely adopted cryptocurrency – first appeared on the market more than 12 years ago, skeptics spoke out. Today, many of them have changed their tune by saying it’s not a fad. This year alone, bitcoin has reached all-time highs, peaking above $67,000 in November. Meanwhile, the popularity of the cryptocurrency world continued to grow, gaining popularity and widespread adoption of popular meme coins, such as Dogecoin (DOGE) and Shiba Inu (SHIB), as well as high-performance coins, such as Ethereum (ETH), Tether (USDT). and Solana (SOL). Speaking of adoption, the dominant influence of cryptocurrencies has been evident this year as it has clearly affected people all over the world. Honestly, if you were like me and many others who thought 2021 was a major year for cryptocurrency, investors would be in for an opening in 2022.
Decentralized solution against inflation
Towards the end of 2021, the term “inflation” was resounding across the United States. In November, the annual US inflation rate rose by 6.8 percent, accelerating at its fastest pace in more than 30 years. Despite the conflicting opinions about what to call our current economic situation, the continued depreciation of the US dollar poses a problem that needs to be addressed. There is no magic bullet for what ten years of printing money has brazenly done to our economy. Central banks will have to respond. Designed to hedge against inflation, Bitcoin and other cryptocurrencies have attracted the attention of more and more investors, including major players JP Morgan billionaire investor, Paul Tudor Jones.
Running on decentralized blockchain technology, Bitcoin and many of its crypto brethren act as better alternatives to cold, hard cash by providing us with legitimately immutable data. In other words: their peer-to-peer networks are designed to prevent potential manipulation of central bankers and self-serving politicians.
In addition, the limited supply of Bitcoin of 21 million coins only helps increase its value. The fact that there is a limit to the number of coins that can be extracted in exchange for the permanent printing of new coins by central banks is a hedge of the act that has reasonably re-emerged in inflation today.
The Metaverse and the Potential New Use Case for Bitcoin
The descriptive idea has proven to be more than a buzzword, it has become more mainstream in the past year – from virtual games to concerts and fine art groups. By providing users with experiences and opportunities through augmented reality, it is argued that the promise of the metaverse may go beyond physical reality. And with user growth increasing 10-fold in 2021, the security and privacy of every transaction is of paramount importance.
Bitcoin underwent a major upgrade in November, called Taproot – a series of upgrades to enhance its ability to perform more complex transactions. By essentially reducing the size and cost of smart contracts, Taproot could open up a new use case for Bitcoin as more smart contracts are developed on the Bitcoin blockchain. The use of smart contacts can be viewed as a sound metaverse map infrastructure, as it helps enhance users’ experience of consuming goods and services.
Potential growth of institutional and government adoption
As mentioned above, it has been a remarkable year for cryptocurrencies with a global adoption increase of just over 880 percent and that’s just the beginning. More than 15,000 companies accept cryptocurrencies as payments for goods and services around the world. This list includes major players, such as TeslaAnd AmazonAnd jamAnd Microsoft, And Starbucks In addition to small and medium-sized companies.
There are also professional sports franchises and professional athletes who have announced their acceptance of cryptocurrency as payments and salaries, among the other rides on the crypto bandwagon. From non-fungible tokens (NFTs) to staff and trading cards to the ability to purchase tickets for sporting events with cryptocurrencies, the real-world adoption of digital currencies is evident in the industry. Crypto has been credited as the future of commerce and fan experience by leaders in the sports industry.
We also see its adoption in developing countries as a solution to economic hope and financial freedom. For example, El Salvador is using bitcoin to rewrite its narrative – from a country with a low GDP per capita to a crypto-leading one. After adopting Bitcoin as legal tender, El Salvador uses it to reduce transfer fees, as well as providing 70 percent of El Salvadorans (who do not have a bank account) with the means for financial services. Not to mention advances in cryptocurrency education are also being worked on.
Other countries that have adopted the use of cryptocurrencies (which El Salvador may follow), include Nigeria – Africa’s largest economy, Vietnam, the Philippines, Turkey, Peru, Switzerland, India, Germany and Japan.
Given the above, one can safely assume that Bitcoin and other cryptocurrencies will be accepted and adopted by more companies across more countries. More adoption and acceptance brings with it the growth rate of individual users. According to a recent survey, 28 percent of respondents expect the price of bitcoin to rise above $75,000 in the next year.
I am a firm believer in cryptocurrency being a currency for promoting human empowerment in that it can change people’s lives for the better. Given everything that happened in 2021, it’s amazing to think that this was only the beginning. From hedging against inflation to its worldwide adoption and its integral role in the evolution of the metaverse, there is clear reason to believe that we can expect to see a continuing trajectory in 2022 for Bitcoin and the crypto world.