FX.co ★ Crypto market boom and panic dampen the fervour of crypto-enthusiasts

The first ten days of the new year can be characterized as bearish. Panic and impending inflation have also dampened investors' fervour and enthusiasm for buying cryptocurrencies.

The Federal Reserve plans to raise interest rates 3 times this year. This will be a serious problem for the entire crypto market.

The crypto market is now already trading at 35% of its historical highs. However, it has always been volatile, and this is a common fact. Right now, Bitcoin is down by 38% from its all-time high, and that could be a good entry point for investors.

Some people say Bitcoin is too volatile right now. Kazakhstan, the world's second-largest Bitcoin mining country, is almost in a civil war and the Fed is trying to raise interest rates. Therefore, it is very risky to invest in crypto right now.

However, Bitcoin remains a safe haven for investors during a period of inflation and tight regulatory policy. Short-term falls in the cryptocurrency cannot change bitcoin's long-term bullish picture.

Analysis by Fidelity Digital Assets found that more than 52% of institutional investors have digital assets, with Bitcoin remaining the most important. Around 70% of institutionalists diversify their finances into cryptocurrency.

A Nickel Digital Asset Management survey revealed that more than 60% of institutional investors would buy Bitcoin in 2022. More than 80% of institutional investors who have already invested in digital assets expect to increase their exposure.

Ark Invest CEO Cathie Wood believes corporations will allocate 5% of their portfolios to cryptocurrencies this year.

Institutional investors have more than $100 trillion worth of assets in their holdings. Wood believes Bitcoin could reach $500,000 in value in 2026, with gains of more than 1,000%. So, according to Cathie Wood, this is the best time to buy Bitcoin.