• According to Arcane Research, 2022 will not be any different from 2021 as Bitcoin will outperform S&P 500 again.

• Ethereum has been predicted to continue outperforming Bitcoin in the coming year, however, its market cap will still be lower than Bitcoin. 

Blockchain data research firm Arcane Research has made an interesting prediction about the crypto market while highlighting some of the key occurrences in 2021. In a report entitled “The Weekly Update”, Arcane Research disclosed that Bitcoin outperformed gold and the stock market for three years in a row. Bitcoin’s 73 percent surge in 2021 did not take anything away from S&P 500 and gold which recorded 28 percent and 7 percent surge respectively. However, the leading crypto asset had a much more volatile year compared to the stock market. 

According to Arcane Research, 2022 will not be any different as Bitcoin will outperform S&P 500 again. The report further discovered that the Bitcoin price was largely affected by the fear in the broad financial market. For this reason, it is now recognized by institutional investors as a risk-on asset. On the other hand, Bitcoin struggled immensely against the Binance coin despite the asset outperforming the stock market. 

According to the report, the Binance coin surged by 1344 percent in 2021. This is partly due to the growth of the Binance Smart Chain which has taken a market share from Ethereum. Comparing Ethereum’s performance to Bitcoin in 2021 saw quite interesting results as the second-largest crypto by market cap surged by 455 percent. In the coming year, Arcane Research predicts that XRP and Cardano will fall out of the top 10 largest cryptocurrencies by market cap.

Layer-1 networks will continue to outperform Ethereum – Arcane Research

Also, just as the Fear and Greed Index gave “thick-skinned investors” some opportunities to accumulate more cryptocurrencies in 2021, a similar cycle will happen in 2022 as the Fear and Greed Index will give opportunities to investors to buy the dip. 

The report further mentioned the multi-year breakout among the most interesting highlights of the year. Ethereum has been predicted to continue outperforming Bitcoin in the coming year, however, its market cap will still be lower than Bitcoin. 

Layer-1 networks like Solana, Terra Luna, Fantom, Harmony, and Avalanche outperformed Ethereum in 2021, in 2022 they will not be any different. They will continue to take market share from Ethereum in terms of funds stored on these networks, and users.

One other interesting highlight was the rise of meme coins. According to the report, 

Meme coins will fade into security, being a historic relic of the absurd times that was 2021.

This year was a breakthrough year for Non-Tangible Token (NFT). This will continue in 2022 as traditional gaming companies will continue to explore possibilities to implement NFTs in their games. In 2022, interest in crypto elsewhere will be muted but Microstrategy will continue to buy Bitcoin. 

Also, though there were 172 crypto-related M&As transactions which are almost three times as many as the previous record year, 2018, the number will even be higher in 2022. Many crypto companies will also go public in 2022 with several of them getting a valuation of at least $5 billion. Also, the Bitcoin hashrate which decreased by about 40 percent after the crackdown in China will reach 300EH/s in 2022. Currently, it has more than doubled from the bottom. It was predicted that the Bitcoin hashrate will be geographically distributed as miners set up in new places like Latin America.