Wall St Week Ahead Crypto investors will be more uncertain after a turbulent start to 2022.

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Investors are anticipating more fluctuations in bitcoin and other cryptocurrencies, amid concerns that the direction of the Federal Reserve threaten to squelch investors' appetite to take risks across the markets. </p>

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The volatility typically associated with cryptocurrency has been on full display during the last few weeks. Bitcoin is the most popular cryptocurrency, has been up around 33% since January. 24 and recently traded at $43,850. It's recovering from an inflection point that cut its cost by half from November's record highest. The primary competitor, ether is up 45percent from Jan. 24 when it was trading around $3200 after a nearly 56 percent decline from its record-setting $4,868 and also in November. </p>

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Even though advocates of cryptocurrencies denied their correlation to other assets as a result, bitcoin and its peer were able to make huge gains during the past two years. ​https://anotepad.com/notes/3n25c9t6 've been rising like stocks when the Fed together with the other major central bankers pumped unimaginable amounts of stimulus to the world economy. Bitcoin has risen 1,039% since March 2020 and Ether has gained 2,940%. However, the rises of both currencies have been slowed by frequent stomach churning sales. </p>

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The recent volatility in the market has been accompanied by a wider market selloff triggered by investors making adjustments to their portfolios to account for a more aggressive Fed which is anticipated to raise rates at least seven times this year while it combats the escalating inflation. The benchmark S&amp;P 500 index (.SPX) has dropped 5.5 percentage year-to date, while the tech-driven Nasdaq (.IXIC) have lost 9.3 percent.. </p>

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Worries that an aggressive policy of central banks tightening moving forward will hamstring high-risk assets has made it difficult for some traders to maintain their bullish view for bitcoin and other cryptos which is an asset class that has been is characterized by high volatility. </p>

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Intensifying tensions in Ukraine In Ukraine, where Washington warned that a Russian attack could start anytime soon, can create market turmoil Investors have said. find out more </p>

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Bitcoin can "really become the most powerful momentum trade and there are plenty of risks that could cause a 40% drop from the midst of the night," said Ed Moya of Oanda, a senior analyst. Oanda. </p>

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The volatility of Bitcoin hasn't stopped analysts from trying to gauge the value of the currency and identifying potential price points. </p>

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Analysts at JPMorgan estimate bitcoin's current fair value to be around $38,000 , which is 15% lower than the current value based on its variability in comparison with the volatility in gold, a similar asset used by investors to protect their portfolios from rising inflation and economic uncertainty. </p>

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Vanda Research, meanwhile, reported in a recent document that most of the bearish bets based on a weaker bitcoin price had been placed at around $47,000 "there could be a large short-squeeze if the aforementioned threshold is reached, and retail investors are reintroduced to trading in crypto." </p>

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Additionally, the correlations between bitcoin and the S&amp;P 500 hit an all-time-high on January 31st, according to research from BofA Global Research, undercutting the argument for those who want to utilize the cryptocurrency as an investment to protect against market volatility. </p>

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Investors are expected next week to receive minutes from the last Fed monetary policy meeting, due out Wednesday. Walmart (WMT.N) in addition to chipmaker Nvidia Corp (NVDA.O) will be among those reporting resultsas earnings season gets underway. </p>

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Some investors are steeling themselves to take advantage of the volatility in bitcoin, hoping that the long-term advantages of blockchain technology, its built-in supply limit and the network effect it produces, will endure despite the frequent price changes. </p>

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Jurrien Timmer, director of macro-economics at Fidelity, likened the current Bitcoin speculation to high volatility tech stocks experienced during that period of dot-com more than two decades ago. This was a boom and bust cycle that left an extremely small number of firms left standing. </p>

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"Amazon remains around, as is Apple remains around and the two are bigger than ever. the thinking is that for bitcoin it's going to be identical," Mr. Smith said. "But bitcoin isn't immune to the waves of speculation and sentiment." </p>

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Bitcoin could reach the $100,000 mark by 2023. Timmer told me, according to his supply/demand model. </p>

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Others think that mature cryptocurrency such as bitcoin and ether aren't going to be able to offer the same breathtaking gains they have experienced since the time of their creation. </p>

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Instead, they are looking to the universe of new alternative currencies that are being developed to make use of the money flooding into the crypto market such as the metaverse and NFTs. NFTs accounted for more than around $30 billion worth worth of venture capital investment last year, according to PitchBook?. </p>

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The most popular altcoins are cosmos Terra Luna, and Polkadot that are all down by 20.5 percent 38%, 20.5% and 25.5 percentage year-to-date on the basis of coinmarketcap.com. </p>

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Understanding the risks associated with them and decentralized financing is likely to be among the most significant challenges for investors in 2022, according to Lily Francus, director of quantitative research strategy at Moody's Analytics. </p>

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Cryptocurrencies "are likely to remain extremely volatile going forward, but there are some major players on the institutional and retail side who are increasing, so interest is still growing," said Oanda's Moya. </p>