The COVID-19 pandemic in 2021 wreaked havoc worldwide, putting people’s lives and livelihoods in jeopardy. However, because of unprecedented monetary stimulus from central banks throughout the world, the cryptocurrency sector achieved a pinnacle boom last year. The total market value of cryptocurrencies soared from US$760 billion in January 2021 to US$2.8 trillion in December, with Bitcoin’s market value eventually settling at US$874 billion after reaching US$1.3 trillion in November.
In light of this, the Babel Finance asset management research team predicts how the crypto-asset markets will develop in 2022 in this paper. The following are some of the report’s significant predictions:
- Bitcoin’s full-year returns in 2022 will be positive: Despite expectations for a rapid rise in US Fed rates, real cash yields in developed markets will remain negative, making it very difficult to get positive returns in the bond market.
- The attributes of Bitcoin will gradually transition from a risky asset to a safe-haven asset: As other safe-haven assets lose their appeal, the Babel Finance’s financing team sees investors from emerging economies will seek any safe haven from catastrophic losses out of fear of a sharp devaluation of fiat currencies during 2022.
- The infrastructure improvement will see CeDeFi usher in an explosive growth period: Aave, currently the largest DeFi lending protocol on the Ethereum network, has launched Aave Pro for institutional investors. Institutions can now enter the decentralized lending market using a whitelist. As wallets and custody services that meet institutional security standards such as MetaMask, Institution, and Fireblocks matured over the past year, the convergence of CeDeFi will also enter an explosive period.
Star fund managers, Wall Street giants, and ordinary investors flocked to the cryptocurrency space. El Salvador was the first country to adopt bitcoin as legal tender in 2021; will other countries follow suit?
The report also highlights 2021 developments and an in-depth analysis of the 2021 crypto-asset market. Babel Finance’s asset management research team is confident that the global economy is still in a state of expansion, and tight monetary policy will not kill the bull market, but it will create great volatility and the opportunities that come with it.
Babel Finance and its experts will continue to monitor crypto-asset market trends and threats. It will look at the regulatory and supervisory implications of the global crypto-assets market to pivot market opportunities and threats. Contact us for a copy of the 2021–2022 Crypto Asset Market Report to learn more about Babel Finance’s findings.
Notes to editors and readers
The report is based on the author’s own research, analysis, and judgment and does not constitute an investment recommendation. Babel Finance assumes no responsibility for any consequences that readers may have.
About Babel Finance
Babel Finance is a global leading crypto financial services provider, offering institutional and HNWI investors professional services covering crypto lending and crypto trading.
The company is backed by prominent investors, including Sequoia Capital China, Tiger Global Management, BAI Capital, Zoo Capital, Dragonfly Capital, and NGC Ventures.
With a business focus in Asia and a business headquarters in Singapore, Babel Finance has established close cooperative relationships with major global exchanges, custodians, investment funds, and mining institutions.
The issuer is solely responsible for the content of this announcement.