Is Crypto Winter Coming to an End?

As Cryptocurrency is a reasonably new addition to the world of financial investments, we don’t have a long track record to look back on to help us predict how things may perform in the future. Cryptocurrency traditionally can be quite volatile with both massive highs and diving lows happening within days of each other. In fact, headlines surrounding digital currency often talk about large personal gains or the massive losses of those that have opted to dabble in Cryptocurrency investment.

The History of Cryptocurrency

Digital current may have been around since 2009 but it only really picked up in popularity amongst mainstream investors in 2017. 5 years is a short amount of time to be able to collect any data and use this to analyse and predict what will happen in the future. However, in the short time that it has been popular Cryptocurrency has already experienced a number of boom and bust cycles, which is just evidence that as an investment choice it is volatile and risky. However, what we also know is that since 2017 there have been plenty of people that have made good money from the right-timed investments and it is the thought of being able to repeat this for themselves that has helped keep people interested and will continue to do so.

Cryptocurrency in 2022

Even those that have not yet been swayed into investing in Cryptocurrency won’t have been able to escape the market crash that digital currency experienced earlier this year. We saw some big changes in the Spring and Summer of this year, including the collapse of some big-name lending platforms such as Three Arrows and Celsius. Alongside that, many well-known (and those not so well-known) Cryptocurrencies saw their values plummet, some within a matter of hours. With no real long-term track record to look at, it was hard for people to predict what this might mean for the market value in the long term and general advice was to hold on to your investments and hope that they would bounce back. This so-called ‘Crypto winter’ is one that has dented the confidence of many investors, especially those that may not invest professionally but are interested in seeing that Cryptocurrency ownership could be their key to early retirement.

Are Things Picking Up?

Although the first half of 2022 was a tricky one for Cryptocurrency values all over, we have started to see a slowing down in decreasing values over recent weeks. That doesn’t mean that we’ve seen any significant improvement, but it does mean that the value for big-name players like Bitcoin appears to have stabilised.  However, as things stand things haven’t yet started to take off as some would have liked. For example ‘The Merge’ with Ethereum has begun and it was hoped that this would help increase the value once again, but it is still not near to the value of its previous highs near to $5,000. However, that doesn’t mean that you should be disheartened, the slowdown of falling values is a good sign and many feel that it is the thawing of Crypto winter and that we could see some more positive news surrounding digital currency in the future.

Will Crypto Winter Actually Come to an End?

Cryptocurrency is definitely one of those topics where people have strong and differing opinions. We won’t really know whether Cryptocurrency will be on the rise in the future until it actually happens but that doesn’t stop experts from having their opinions and predictions.

Many crypto investors argue that a huge benefit of crypto is that it is not beholden to a central regulator, like the gambling industry and PayPal casinos in the UK, but some experts say this is why the market has been so volatile of late and argue that changes could mean we see a less volatile market.

Cryptocurrency Regulation

One thing we do know about digital currency is that it is largely unregulated and that this could change in the future. Although there have been no official announcements surrounding the likes of Bitcoin, it is the only currency that can be traded with no regulations. Day trading puts limits on certain financial transactions being able to take place & even those that dabble in stocks and shares have to do so within the rules, in order to ensure that everyone is protected.

So far this hasn’t happened with Cryptocurrency but many argue that some formal regulation is well overdue and could be introduced soon. The UK government has recently talked about their own Stable Coin and the support of things such as NFT investment; which could be said to be the first steps toward more regulations being introduced within the UK. Whilst many like the unregulated and anonymous nature of Cryptocurrency, most recognise that investments being protected and there being rules about who can operate as a trading platform can only be a good thing.

However, whilst we can’t predict if and when the regulation will be brought in we do know that anything like this is likely to have an impact on Cryptocurrency value – although experts are in disagreement as to whether this will initially be a positive or a negative change.

The Future of Cryptocurrency

There are some experts that believe a Crypto winter like the one we have seen is one that could last for a number of years, in which case we’re not likely to see an end to it in 2022. However, others feel that it is already towards the end and we’re starting to see a positive change in terms of Cryptocurrency value. The untested nature means that realistically, no one is able to accurately predict what will happen. Instead, those that are already invested in Cryptocurrency or those that wish to add it to their investment portfolio are best to keep an eye on the ever-changing values and of course, newspaper headlines to see what changes are afoot and what impact that is likely to have