Numerous crypto market analysts and experts have stated that the falling cryptocurrency prices through December are a result of the recent surge of Omicron-fueled COVID cases. Omicron, the highly mutated COVID variant, is now fueling hundreds and thousands of cases in countries around the world. Due to the virus’ recent resurgence, the crypto market has taken a battering, as investors have been keen to pull away from risky assets.
Currency investment firm BKCM founder and CEO, Brian Kelly, said that numerous macro funds use Bitcoin as pro-cyclical inflation hedge. According to Kelly, these funds have taken a decision to take profits in December owing to the rising COVID-driven concern.
Kelly is bullish on Bitcoin and according to him, there’s a chance that Bitcoin will hit $100,000 by the time 2022 is done and dusted. However, he also added that several other coins in the world of DeFi, gaming, and the metaverse will rise in 2022.
Blockchain Coinvestors partner Lou Kerner is of the opinion that cryptocurrency prices have also fallen due to concerns over cryptocurrencies’ energy-efficiency. According to Kerner, there are many investors in the investment community have a negative stance towards cryptocurrencies, especially the ones that work on the ‘proof of work’ consensus algorithm. Cryptocurrencies with the ‘proof of work’ consensus algorithm, such as Bitcoin, consume a mammoth amount of electricity.
However, Kerner is optimistic that in 2022 and the years ahead, the energy concerns surrounding cryptocurrencies will go down. Kerner added that the majority of energy consumed by crypto operations globally is energy unsuitable for any other purpose.