Well, wasn’t 2021 sort of a moon launch? I think so. It hit all-time highs despite all the “legends” saying it’s a worthless seashell for tech dorks. Wrong! Hey, it’s not $68,000, but it’ll get there again.
“Bitcoin will reach at least $200,000 by 2025,” says Paycer UG founder & CTO Nils Gregersen in Hamburg, Germany. “But I am pretty sure we will see it fall to around $20,000 before hand.”
Okay, no panicking. I’ll buy it.
What about the rest of the cryptocurrency space? There’s more to this market today than Bitcoin. Cryptocurrency investing is the new stock market. Everybody knows that.
This year was a very interesting one for crypto. We saw trends coming and going very fast — with coins hyped up by influencers like Elon Musk — who gave Dogecoin a lift for a short time before it returned to being a dud coin.
“There is a lot of pump in the market at the moment,” says Gregersen. “I think in 2022 we are going to see a little cooldown in the market. Only the stronger projects will survive. For the memecoins and other shady projects, I think the air gets a little thinner for them,” he says, adding that regulations will have an impact on DeFi cryptocurrencies, within varying degrees of positives and negatives.
“DeFi will still be a thing in 2022. We have only seen the tip of the iceberg in terms of DeFi,” says Gregersen. “There are many new products to come that we can’t even imagine today.”
Some DeFi trends expected next year: Decentralized Autonomous Organizations (DAO) that offer unregulated, decentralized finance and a new regulated centralized- decentralized finance. Call it the yin and yang of DeFi, I guess. CeDeFi will offer less complex financial services based on DeFi but will hold hands with the regulators of financial markets and banking, in general. This might be the type of DeFi that Jim Cramer of Mad Money can get behind.
Ava Labs president John Wu also predicts DeFi will have a good 2022.
But he seems to like the GameFi space even more.
“DeFi will continue to lead in terms of total value in the ecosystem, but blockchain gaming will introduce more people to crypto because the learning and adoption curves in gaming are notably smaller than that of DeFi,” he says.
Yeah, I’m still playing video games on an X Box One. I don’t know about blockchain games. I have never stared into the eyes of any blockchain yet. I’ll have to do that this year.
“Gaming growth is outpacing new DeFi activity. Just wait until major developers and studios get involved,” Wu says.
GameFi is considered a subset of the metaverse as most game developers in the blockchain world are building their ecosystem to be more linked to the virtual world. Non-fungible tokens (NFT) are also an offshoot here — because diehard gamers will spend money for digital art, let alone weapons and other gear (or fake land) associated with a game.
The metaverse is in its infancy. So this gives crypto investors a chance to get in on the ground floor of some of the newcomers. I own Decentraland (MANA) as my metaverse play.
“Getting aboard the metaverse train today with all the connections to other aspects of blockchain evolution will be synonymous to getting aboard the Bitcoin train in its earliest days,” says Sven Wenzel, co-founder of Castello Coin, which operates in the digital art space. “An early investment in a metaverse token can amount to so much more in the longer term,” he says in comparing metaverse plays with the likes of Bitcoin.
Castello Coin and Decentraland all run on the Ethereum blockchain. It’s still the No. 2 cryptocurrency investment after Bitcoin. How will Ethereum look in 2022?
“I would invest in Ethereum. I would invest $200 every month in Ethereum,” says Gregersen.
Overall, market participants expect more people opening accounts with exchanges. That’s a long term bullish signal for cryptocurrencies.
I predict some of the more old school platforms (think E*Trade) will allow for investment in at least Bitcoin and Ethereum next year. That should get more people involved, especially those who can’t be bothered opening up a Gemini account, for instance.
The resilience of cryptocurrencies is expected to be a highlight again this coming year. We all have witnessed how our investments can snap back rather quickly from a 10% or 20% loss.
In the past, this would have triggered a sustained downturn and ‘crypto winter’, but better risk management on the professional investor side means the market just has a snow day instead. People will be buying the dips in 2022.
I know I will. After a 23 day battle with Covid, I’m ready to put some money to work in my Coinbase account again. I’ll probably load up on some Bitcoin. After these interviews, I might have to check in on MANA.
Besides investing ideas, Wu from Ava Labs thinks more traditional brand name corporations will enter the space in 2022.
“Look at the list of major media companies, sports leagues or content creators participating in digital assets at the start of the year versus the end of it,” he says. Deloitte and Mastercard recently linked up with Ava Labs to explore their Avalanche blockchain and its smart-contract enabled applications.
This year was a true zero-to-60 growth in new blockchain protocols like Solana (SOL) and Polkadot (DOT). Many Fortune 500 companies who used this year to explore what NFTs and digital assets can do for them will be two feet in, in 12 months’ time, Wu predicts.
“They’ve seen their peers succeed and so the risk of failure is low enough to make a move,” he says.
If you watched the World Series, you saw the FTX crypto exchange logo on the jerseys of the umpires. Yes, you can buy and sell NFTs on FTX, like the currently priced $615 Stephen Curry NFT: The 2974 Collection.
So 2021 was the year of NFTs, for sure. What will 2022 be the year of, if you had to pick one?
More new blockchain projects, especially for businesses, says Wu.
“I think you will see enterprise blockchain pilots move into the live stages a lot quicker than people expect,” he says.
Sorry, haters, the world will still be investing in digital assets in 2022. To steal an old adage from the world of Wall Street: the trend is your friend.
**The writer owns Bitcoin, Polkadot and Decentraland. Oh, and sadly, Dogecoin.**
Pandemic darlings face the boot as investors eye return to normal life
Stay-at-home market darling Netflix slumped on Friday, joining a broad decline in shares of other pandemic favourites this week as investors priced in expectations for a return to normal life with more countries gradually relaxing COVID restrictions.
The selloff, which began after Netflix and Peloton posted disappointing quarterly earnings, spread to the wider stay-at-home sector as analysts judged the new Omicron coronavirus variant will not deliver the same economic headwinds seen in the first phase of the pandemic in 2020.
“This a confirmation that the economy is gradually moving towards some sort of normalisation,” said Andrea Cicione, head of strategy at TS Lombard.
France will ease work-from-home rules from early February and allow nightclubs to reopen two weeks later, while Britain’s business minister said people should get back to the office to benefit from in-person collaboration.
“With a return to the office and travel lanes opening, darlings of the WFH (work from home) thematic are reflecting the growing reality that the world is moving slowly but with certainty towards a new normalcy,” said Justin Tang, head of Asian research at United First Partners in Singapore.
Netflix tumbled nearly 25% after it forecast new subscriber growth in the first quarter would be less than half of analysts’ predictions.
The stock, a component of the elite FAANG group, was on track for its worst day in nearly nine-and-a-half years following rare rating downgrades from Wall Street analysts.
“It is hard to have confidence that Netflix will return to the historical +26.5 million net subscriber add run rate post the 2022 slowdown,” MoffettNathanson analyst Michael Nathanson said.
“The decay rate on streaming content is incredibly rapid. ‘Squid Game?’ That’s so last quarter. ‘The Witcher?’ Done on New Year’s Eve!”
Exercise bike maker Peloton lost nearly a quarter of its value on Thursday, leading at least nine brokerages to cut their price target on the stock.
The selloff erased nearly $2.5 billion from its market value after its CEO said the company was reviewing the size of its workforce and “resetting” production levels, though it denied the company was temporarily halting production.
Peloton’s shares were up nearly 5% on Friday morning, bouncing back somewhat from a 23.9% drop on Thursday, its biggest one-day percentage decline since Nov. 5.
Both companies were part of a group, along with others such as Zoom and Docusign whose shares soared in 2020, and in some cases 2021 as well, as people around the world were forced to stay at home in the face of the coronavirus.
However, thanks to vaccine rollouts and the spread of the less severe Omicron strain of COVID-19, life is returning to normal in many countries, leaving companies like Netflix and Peloton struggling to sustain high sales figures.
According to data from S3 Partners, short-sellers doubled their profits by betting against Peloton in 2021, the third best returning U.S. short.
Direxion’s Work from Home ETF has fallen more than 9% in first three weeks of the year, compared to a 6% drop in the fall of the broader U.S. stock market. Blackrock‘s virtual work and life multisector ETF has weakened more than 8% this year.
In Europe, lockdown winners are also going through a rough patch as rising bond yields pressurise growth and tech stocks.
Online British supermarket group Ocado, Germany’s meal-kit delivery firm HelloFresh and food delivery company Delivery Hero which emerged as European stay-at-home champions in the early days of the pandemic have underperformed the pan-European STOXX 600 so far in 2022.
(Reporting by Alun John and Julien Ponthus; Additional reporting by Nivedita Balu, Anisha Sircar and Chuck Mikolajczak; Editing by Saikat Chatterjee, Alison Williams and Saumyadeb Chakrabarty)
Bitcoin falls 9.3% to $36,955
Bitcoin dropped 9.28% to $36,955.03 at 22:02 GMT on Friday, losing $3,781.02 from its previous close.
Bitcoin, the world’s biggest and best-known cryptocurrency, is up 2.4% from the year’s low of $36,146.42.
Ether, the coin linked to the ethereum blockchain network, dropped 12.27% to $2,631.35 on Friday, losing $368.18 from its previous close.
(Reporting by Jaiveer Singh Shekhawat in Bengaluru; Editing by Sriraj Kalluvila)
Oil, gas investment forecast to rise 22% in Canada – Investment Executive
It’s positive news for an industry that has now essentially recovered to its pre-pandemic levels, after a disastrous 2020 that saw oil prices collapse due to the impact of Covid-19 on global demand.
But CAPP president Tim McMillan pointed out that in spite of the fact that oil prices are at seven-year highs and companies are recording record cash flows, capital investment remains well below what it was during the industry’s boom years. In 2014, for example, capital investment in the Canadian oilpatch hit an all-time record high of $81 billion, capturing 10% per cent of total global upstream natural gas and oil investment.
“Today we’re at $32 billion, and we’re only capturing about six% of global investment,” McMillan said. “We’ve lost ground to other oil and gas producers, which I think is problematic for a lot of reasons . . . and it leaves billions of dollars of investment that is going somewhere else, and not to Canada.”
Investment in conventional oil and natural gas is forecast at $21.2 billion in 2022, according to CAPP, while growth in oilsands investment is expected to increase 33% to $11.6 billion this year.
Alberta is expected to lead all provinces in overall oil and gas capital spending, with upstream investment expected to increase 24% to $24.5 billion in 2022. Over 80% of the industry’s new capital spending this year will be focused in Alberta, representing an additional $4.8 billion of investment into the province compared with 2021, according to CAPP.
While the 2022 forecast numbers are good news for the Canadian economy, McMillan said, it’s a problem that companies aren’t willing to invest in this country’s industry at the level they once did.
He said investors have been put off by Canada’s record of cancelled pipeline projects, regulatory hurdles and negative government policy signals, and many now see Canada as a “difficult place to invest.”
However, Rory Johnston, managing director and market economist at Toronto-based Price Street Inc., said laying the decline in the industry’s capital spending at the feet of the federal government is overly simplistic.
He added while current “rip-roaring, amazing” cash flows and a period of sustained high oil prices will certainly give some producers the appetite to invest this year, Johnston said, it will likely be on a project-by-project basis and certainly on a smaller scale than the major oilsands expansions of a decade ago.
“You have global macro trends across the entire industry that have begun to favour smaller, fast-cycle investment projects – and most oilsands projects are literally the polar opposite of that,” he said.
One reason capital spending isn’t likely to return to boom time levels is because companies have become much more cost-efficient after surviving a string of lean years. And that’s not a bad thing, Johnston said.
“The decade of capex boom out west was tremendously beneficial for Canada and Albertans, but it also caused tremendous cost inflation,” he said.
“While what we’re seeing right now is not as construction-heavy and not as employment-heavy – and those are two very, very large downsides – the upside is that you’re much more competitive in a much more competitive oil market,” Johnston said.
In a report released this week, the International Energy Agency (IEA) hiked its oil demand growth forecast for the coming year by 200,000 barrels a day, to 3.3 million barrels a day.
According to the IEA, global oil demand will exceed pre-pandemic levels this year due to growing Covid-19 immunization rates and the fact that the new Omicron variant hasn’t proved severe enough to force a return to strict lockdown measures.
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