If you traded $100,000 to BTC on January 1st, 2022, you would have lost $59,678 (almost 60% of your investment) by July 1st. If you had instead bought USDT, you wouldn’t have lost anything. Instead, you would have gained over 10% in purchasing power as the USD rose compared to other currencies.
So, is trading BTC to USDT a wise move? Let’s take a look at the state of the crypto market and decide if USDT is a smart bet right now.
Bitcoin: Market Position
Bitcoin has had a bad year in 2022, falling to less than a third of its 2021 high of $67K. Since mid-June 2022, the price has stabilized between $19K and $25K. But, it’s come nowhere near regaining any significant portion of its losses. The story has been similar to most cryptocurrencies on the market.
Bitcoin’s losses can be attributed to the change in the economic situation. In 2021, governments and central banks were very generous with cash handouts and funding. This inflated a cryptocurrency bubble as people invested extra cash in crypto. In 2022, inflation caused this situation to reverse. Now, cheap money has been withdrawn from the US and most other economies, and it’s unclear when the economic situation will turn again.
BTC Price Prediction From Experts
There are experts that forecast the price of Bitcoin and other cryptocurrencies. They do this by predicting aggregate crypto market movement, as well as how individual tokens will perform relative to each other. Here’s a collection of short-term and long-term price predictions for BTC.
Predictions for the end of 2022:
|End of 2022 Predictions|
The consensus is that Bitcoin will recover somewhat from its lows, but won’t approach its 2021 highs.
Three- and eight-year BTC price predictions:
|2025 Prediction||2030 Prediction|
The consensus is that BTC will surge to all-time highs in 2025, reach over 10x its current level by 2030.
Tether: Market Position
USDT (Tether) remains the dominant stablecoin on the crypto market, with the daily most trade volume of any cryptocurrency ($60-70 billion). The price of USDT is relatively stable at $1. Although, there was a sustained period where the price dropped to around $0.999 and didn’t recover for months. This price is unlikely to change as long as the Tether organization can maintain stability.
USDT Price Prediction from Experts
Most experts see USDT maintaining its peg to the US Dollar in the short/long term. However, there can still be fluctuations up or down that can affect long-term investments and large amounts of investment.
Predictions for USDT for 2022:
|2022 lowest possible price||2022 average price||2022 highest possible price|
The price is predicted to roughly maintain its peg overall, but with the possibility to lose its peg by up to 15% in either direction.
The long-term USDT price is less dependent on short-term fluctuations and more on the viability of the Tether project. Arcane research predicts that USDT will likely maintain viability in the future.
USDT is a safer bet than BTC right now. The BTC price has dropped two-thirds from its highs and could go even lower. This is unlikely to happen with USDT. However, USDT is also unlikely to benefit from any future crypto boom. So, swapping BTC to USDT is a wise move if you want to protect your investment in the short term. But, if you want good long-term returns it isn’t a good investment.