2021 was a volatile but very successful year for all cryptocurrencies.
The market capitalization of various cryptocurrencies tripled from less than $800 billion on 1 January to around $2.2 trillion today, with some assets seeing astronomical progress in terms of both price and users.
Cryptocurrencies now are also an integral part of the gambling world. While some gamblers prefer Boku online payments, others are enjoying the benefits of betting with Bitcoin in online casinos.
The significant growth of crypto money has been spread across the ecosystem, as Bitcoin and Ethereum have gone from 80% market cap to just over 60%. Moreover, the continued success of DeFi (decentralized finance) applications and non-gambling tokens (NFT) suggests that 2022 could be an even more profitable year.
Here are five key trends in the cryptocurrency world to watch out for.
Bitcoin ATMs Multiplay
The intangible nature of cryptocurrencies has been holding back their development for a long time. The fact is that many people find it difficult to perceive bitcoin as real money because they cannot see or touch it.
But now that the installation of bitcoin cash machines is gradually becoming a reality around the world, people will be more likely to perceive digital assets as tangible and, therefore, real investment instruments.
The number of bitcoin ATMs has been growing steadily since 2015, reaching a new high in 2021. According to Coin ATM Radar, there are now more than 33,000 bitcoin ATMs worldwide.
Bitcoin ATMs allow you to buy BTC with credit or debit cards. This makes cryptocurrencies more accessible and therefore attractive to those who have not yet tried them.
Bitcoin ATMs can make cryptocurrency brokers unnecessary because they can easily process crypto-transactions – although fees may cause people to seek better terms elsewhere.
Constant Volatility of the Bitcoin Price
Bitcoin is the largest kind of cryptocurrency in the world. Interestingly, its price remains the most recognized benchmark for the cryptocurrency market. You probably know that bitcoin has shown consistent volatility in 2021.
It reached an all-time high of more than $60,000 in April, then collapsed to below $30,000 in July and reached a new all-time high of nearly $70,000 in November before falling to its current level of below $50,000.
This volatility is likely to continue into 2022 and beyond, as the market of crypto money is not yet fully mature.
In fact, volatility is one of the reasons why many experienced traders love bitcoin – its fluctuations allow for arbitrage opportunities – but it is also why many asset managers advise caution and recommend that their clients invest only 5% of their portfolio in cryptocurrencies.
This means investors should be prepared for bitcoin to fall as often as it rises.
Those who buy cryptocurrencies assume that this type of currency will remain volatile in the short term but will steadily rise in value over the long term, despite regular sharp corrections. Consequently, investors need to be patient and not worry about temporary fluctuations.
Gamification and the Metaverse will Continue to Evolve
Blockchain gamification started to evolve in 2021. Axie Infinity (AXS) has pioneered the concept of ‘play-to-earn’ games.
This, combined with outstanding graphics and exciting gameplay, has sparked a surge in demand for crypto games. “Play-to-earn” games mean that players can earn tokens in the game, which can be exchanged on a cryptocurrency exchange rate for real cash.
Facebook’s decision to rebrand Meta has drawn a lot of attention to virtual worlds, although meta universes have been gaining traction for some time.
It remains to be unclear what form these virtual worlds will take – in particular, whether they will be decentralized or whether corporations will dominate the space.
Anyway, since cryptocurrencies are an extremely popular form of payment in the meta world, we can expect various types of cryptocurrencies to be part of this great evolution.
Environmental Improvements
Those who are skeptical about crypto money are drawing attention to the environmental impact of blockchain networks, an issue that even some crypto enthusiasts are concerned about. The thing is, Bitcoin mining requires a lot of computing power, which consumes a large amount of energy.
Since most of the market volume of cryptocurrencies is accounted for by coins that use proof-of-work in the mining process, it is unlikely that energy costs will change significantly in 2022.
In addition to the high energy costs of bitcoin mining, the process also generates a lot of electronic waste from discarded miners.
However, it’s worth noting new cryptocurrencies like Cardano and Solana have been praised for using a share-proof method that does not require high energy costs.
Ethereum, which is the No. 2 cryptocurrency according to the market capitalization, is on the verge of switching to the share-proof method, which should encourage other kinds of cryptocurrencies to follow suit and make their processes more environmentally friendly.
If the number of green cryptocurrencies increases by 2022, that would be good for the market, even if Bitcoin’s energy consumption does not improve.
More Regulation
The crypto industry has thrived so far thanks to (or despite) its decentralized structure and unregulated nature. Nevertheless, many in the industry will tell you they are open to regulation as long as the rules are enforced transparently.
At the moment, governments are trying to find an efficient way to regulate different cryptocurrencies in a way that deters cybercriminals and increases security for retail investors.
China has shown one way to do this – by making cryptocurrency activity within its borders virtually illegal, except for those sanctioned by the government.
Crypto investors and many entrepreneurs want to have a more moderate approach in states where the SEC, CFTC, and departments of the Treasury Department are insisting on new rules.
Investors would benefit from proper regulation a lot as they could have cleared tax rules and even the possibility to add crypto investments to retirement accounts.
And if well-known trading tools for cryptocurrencies are brought into line with the regulations, they could also increase popularity by offering investors an additional layer of security.