Lark Davis is one of the most famous crypto influencers. His YouTube channel is subscribed to by over 473,000 users, while his Twitter account has more than 757,000 followers. In a series tweet In his recently published post, he shared 7 reasons why prices will keep rising in 2022.
Among the top reasons, Lark Davis mentioned that the Spot Bitcoin Exchange Traded Fund (ETF) is about to be approved. He also mentioned the phenomenon of extended cycles and major upgrades to the Ethereum network.
At the same time, he outlined optimistic expectations for the largest altcoins, emphasized the importance of the NFT market and blockchain gaming, and drew attention to institutional investors.
The first reason Lark Davis presented was the long awaited spot Bitcoin ETF.
As reported, the first Bitcoin ETF was approved in October, but it is a fund based on cash settled futures contracts and not on physical Bitcoin from the spot market.
Therefore, the community is still waiting for the ETF to be linked directly to the BTC spot price. Currently the ETF is only tied to its futures contract.
A spot ETF is expected to be launched in 2022, according to Davis. In anticipation of the possible impact on the Bitcoin price, KOL points to a similar situation in the gold market.
“Gold rallied strongly before a spot ETF was approved, followed by a year of sharp declines and multi-year rallies.”
The source: Twitter
The ongoing cyclical phenomenon of Bitcoin and the entire crypto market is not just a hypothesis.
Historical analysis shows that each subsequent BTC cycle is longer than the previous one and that the importance of the halving is gradually decreasing. Additionally, ROI also decreases over successive cycles so owners should be willing to see lower returns over time.
Lark Davis argues that the BTC price high in this bull market will hit in 2022 based on extended cycle data. He refers to Benjamin Cowen’s analysis of the same subject. Furthermore, Davis stressed, should this happen, “the four-year cycle theory is (likely) dead”.
The source: Twitter
It’s worth noting that Cowen said there is a chance the current bull market will peak in 2023. In his opinion, each subsequent cycle lasts 1-1.5 years.
Another important catalyst for a sustained bull market is the development of the Ethereum blockchain.
This network is gradually increasing its share in the cryptocurrency market. At the time of writing, ETH has a dominance rate of 19.8%, according to CoinGecko. Additionally, ETH’s $ 450 billion market capitalization is more than 50% of BTC’s $ 888 billion market capitalization.
Lark Davis lists some of the key changes Ethereum is making: transition to the proof-of-stake protocol, triple halving, limited implementation of sharding that is expected to result in a 4-fold increase in transactions per second, triple.
Most of these upgrades are scheduled for 2022, so the bull market could be extended until these changes are implemented. KOL then added:
“ETH is still the king of smart contracts, so what happens to them has an impact on the entire market.”
The fourth reason on Davis’ list is the rapid growth of key alternative blockchain networks to Bitcoin and Ethereum.
The growing diversification of the cryptocurrency market is a healthy sign that the industry is growing rapidly. At the same time, it takes time for sustainable growth. Accordingly, the innovation of the best projects will not slow down in 2022.
Among the dominant altcoins, Lark Davis lists Polkadot (DOT) and Cardano (ADA) – these are the networks “that bring more money to the market”.
He added that other Layer 2 solutions are also growing rapidly in 2021, including Avalanche (AVAX), Polygon (MATIC), and Solana (SOL).
The NFT market is very active in 2021.
Additionally, more and more popular brands are choosing to release their own NFT collections to find new channels to reach their audiences.
This month, Germany’s top soccer division and the world’s largest video game publisher Ubisoft decided to do so.
Lark Davis highlights the importance of NFT as a gateway to mass adoption of cryptocurrencies:
“NFT continues to generate public interest and brands are constantly reaching out to them. NFT will be the first entry point for millions of people into the crypto space. ”
The sixth argument for expanding the bull market by 2022 is the development of blockchain video games and the Metaverse project. Many of these major projects are still in development, with important games being announced next year.
This doesn’t change the price of virtual land in the biggest blockchain games, which is rising rapidly.
In late November, a property in Axie Infinity (AXS) raised a record $ 2.3 million. Previously, a property on Decentraland (MANA) was sold for $ 900,000 in June.
Another catalyst for blockchain video game adoption and popularity is the growth of the play-to-earn (P2E) sector.
It enables video game fans not only to pursue their hobby, but also to earn cryptocurrency and later exchange it for local fiat money. For example, many P2E players in the Philippines make a living playing their favorite games.
Lark Davis also highlighted the potential influx of new users and cash into the crypto market in 2022.
“The game will attract tens of millions of new users or more. Metaverse is the trillion dollar industry of the future. ”
The final basis for predicting the bull market through 2022 is the large inflow of money from institutional investors.
According to Davis, they are “just beginning to realize that this is the best kind of technology investment this decade”. Reports of MicroStrategy’s next big Bitcoin purchase were by far the norm.
However, other large groups of investors are joining Michael Saylor’s company.
More and more cities in the US are introducing the option of paying salaries in BTC or launching retirement plans with crypto. Cathie Wood predicts massive inflows from institutions, with allocating just 5% of her funds will push the BTC price down to $ 500,000.
Above all, Lark Davis points to rampant inflation, which will further strengthen the value of deflationary cryptocurrencies. In conclusion, Davis commented, “The great bull cycle is likely to end“ in 2022 ”.
He then added that the next bear market will be “fundamentally different” and encourage profit-taking when prices rise.
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