What is the Worst-Case Scenario Bitcoin can Land Into in 2022?

Investors expect to estimate what the worst-case scenario for Bitcoin would look like

If you are a crypto investor, then you are quite familiar with the current situation of the market. There are two most prominent questions revolving around the investor community; firstly, when will the crypto prices rise again and what might end up being the worst-case scenario for Bitcoin. The last two weeks have been extremely crucial for investors, with crypto prices dropping to new lows, rising economic inflation, and monetary changes, accompanied by rising regulatory provisions in the market have spooked investors and have spilled a wave of fear and panic in the investor community. Terra, one of the top cryptocurrencies in the market lost over 95% of its value within 24 hours, causing huge financial losses to crypto buyers. But despite this massive crash, experts believe that the worst is yet to come. Bitcoin has not yet reached its worse stage, but the real question is how should investors prepare for the worse if the volatility is as extreme as the current situation?

Bitcoin has had a rough start to the year, but experts still wished for it to reach the US$100,000 resistance. The leading cryptocurrency is trading at a relatively tight range and is mainly focusing around the US$19,000 mark. The crypto was able to bounce back to US$20,000 and was gradually sliding towards US$21,000, but unfortunately, BTC failed to move past that and eventually retracted back to US$20k. Experts say that Bitcoin might fail to retain its 200-week MA, which might eventually lead the crypto to lose about another 50% of its value. While some experts believe that BTC might bounce back again from its current crash, others have already grown weary and are selling off their investments as soon as possible.


How did Bitcoin descend so fast?

The correlation between crypto and the global economic and financial markets is exceedingly growing. All cryptocurrency investments are on edge since the digital asset market is enduring the madness of the global financial markets, massively obliterating one of the many perks of investing in the crypto market, decentralization. As inflation continues to grow and is expected to stay for another two years, experts predict that an imminent economic recession might take over the crypto market and weaken major cryptocurrencies even further.

Besides, a weak economic and financial market, the price of BTC also fell after Terra’s implosion. In Bitcoin’s history, the crypto has remained mostly unaffected by the price movements of other digital assets. But Terra’s implosion is one of the major reasons why investors have lost their trust in cryptocurrencies and quickly left the market. Besides, the aggressive interest rate hike by the US Federal Reserve to cool down inflation conditions in the economy also resulted in degrading Bitcoin prices. The increasing of interest rates is generally viewed as a step that is commonly viewed as a leading recession indicator.


Bottom Line

The declining price of Bitcoin also has its positive side of things. It allows new investors to enter the market and has also enabled more investors to buy BTC tokens. There are still several BTC believers who expect that this might not be the end of the cryptocurrency. BTC will rise again and will continue to reign over the crypto market.