Crypto Winter Will End Before 2022 Is Out - Korbit
South Korean researchers say that crypto winter will end before the financial year is over, but think that the US Federal Reserve’s attempts to bolster the United States economy could continue to influence crypto markets in the meantime.
The research was carried out by the domestic exchange Korbit and reported by Maeil Kyungjae. The exchange’s research unit predicted that a “prolonged” crypto winter – characterized by low or stagnant bitcoin (BTC) and altcoin prices – would continue for many months yet, but would finally end before the end of the fourth quarter of the current financial year.
The researchers looked at trends from previous crypto winters, and drew a parallel with the slump that began in late 2018.
Jeong Seok-moon, the head of Korbit’s research unit, was quoted as stating:
“This market downturn is similar to the ‘third crypto winter,’ which the markets experienced between the end of 2018 and early 2019.”
Jeong opined that the Fed’s “tightening” monetary policies had sparked a slump in late 2018. This slump, he said, was “unlike the first and second” crypto winters, which were “caused by internal factors in the cryptoasset markets.”
As such, he added, those “forecasting the timing of” the crypto market recovery would do well to pay attention to predictions about “when the Fed’s monetary policy stance might change.”
Korbit thinkers expect that “change” to happen in the fourth quarter, claiming that inflation would “gradually ease” during the second quarter of the year, with further positive news to come from the ISM manufacturing index.
Researchers at the Korbit rival Bithumb concurred. Hanguk Kyungjae quoted Lee Mi-sun, the head of Bithumb’s own research unit, was quoted as stating that the Fed’s rate-hiking policy was likely to be short-lived. She explained that the Fed was likely to start cutting rates again before the calendar year is out. Lee concluded:
“Bitcoin prices will bottom out in the second half of this [calendar] year, and will show signs of stabilization as the end of the year approaches.”
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