After a somewhat disappointing performance in December, which saw the price of digital currency bitcoin fall, El Salvador’s president Nayib Bukele ignited debate when, on 2 January, he made a number of strong predictions about the cryptocurrency’s performance in 2022.
Among other things, the now-viral tweet, which earned 36,300 likes, predicted that Bitcoin will reach $100k in 2022, that 2 more countries will adopt it as legal tender and that construction will begin on Bitcoin City, a proposed tax-free city in El Salvador.
Bukele also predicted that bitcoin will become a major electoral issue in the US – it’s certainly something that republican leader Donald Trump has been vocal about, dismissing the cryptocurrency as a scam and slamming it for competing against the dollar – although his wife, Melania Trump appears to hold different views which she wasn’t afraid to also share on Twitter:
It is widely reported that Bitcoin's market cap exceeds USD$1 Trillion. Today marks the 13th anniversary of the Bitcoin Genesis Block. Happy Anniversary, #SatoshiNakamoto #MelaniaNFT pic.twitter.com/aZqNJFcZmd
— MELANIA TRUMP (@MELANIATRUMP) January 3, 2022
If it can ignite controversy within a political household, can attract the attention of a president and get the CEO of one of the World’s largest financial institutes, Nigel Green of DeVere talking about it, it’s certainly fair to say that the peer to peer electronic cash system has achieved widespread recognition since it’s creation in October 2008. Bitcoin evolution has been fast, in just 12 years it’s gone from creation to becoming legal tender in El Salvador, accepted on mainstream payment platform Paypal and growing in acceptance.
One of the reasons bitcoin could be playing a part in the US elections is that a number of US politicians have welcomed donations via Bitcoin for their political campaigns, not least the National Republican Congressional Committee.
Bulls are already predicting a strong BTC performance in January. Analyst Alex Krüger notes that the start of January has traditionally been a strong period for BTC since 2018 and expects 2022 to follow the same trend. We can also expect to see new investors entering the space thanks to the proliferation of trading platforms, which enable smaller investors to enter the trading market with lower investments.
We can also expect to see BTC mining hardware continuing to evolve – which will have an upwards impact on the price of powerful graphics cards – but we’d also expect more pressure to make mining more sustainable as stats recently revealed it to have massive carbon footprint. In a world where global warming is an increasingly challenging issue, bitcoin miners will be asked to play their part.
Overall, the outlook for bitcoin in 2022 is good and many analysts expect the $100,000 price point to be reached either this year or shortly after – however the US are already considering the introduction of new cryptocurrency regulations for the new class of assets. It could be an interesting year ahead.