Bitcoin is on track to gain ground in 2022, making the high of $69,000 less than a year ago seem an eternity away. However, some market observers believe that the largest cryptocurrency could regain its lost luster in 2023.
Bitcoin Star may be reborn in 2023
Assuming the forecast turns out to be accurate, it could benefit a number of exchange-traded funds, including VanEck Bitcoin Strategy ETF (XBTF )it VanEck Digital Assets Mining ETF (DAM )and VanEck digital transformation ETF (DAPP ).
They actively managed XBTF provides exposure to bitcoin futures while DAM and DAPP are index-based ETFs that focus on crypto-correlated stocks — an asset class that faces its own share of 2022 struggles as digital currency prices pull back.
“So what happens next? Where Bitcoin sits at the end of the third quarter could be key in the near term, according to Rekt Capital, a popular crypto technical research newsletter. Quarter-ends are closely watched levels for traders,” reported Jack Denton for Barron’s.
Rekt Capital’s analysis of bitcoin’s recent technical data indicates that the digital coin could suffer more pain if it cannot hold the $19,880 area, suggesting that if this level is breached, investors need not rush into ETFs such as DAM, DAPPand XBTF.
However, if that price range acts as credible support or if it bites new bear market lows, these ETFs could be attractive options for risk-tolerant buyers. Add to that, among all major asset classes, bitcoin is expected to be the best performer in 2023, according to some experts.
“Bitcoin has the highest projected return over the next year or so among asset classes including global equities, government bonds, corporate debt, real estate, private equity and hedge funds, according to analysis and projection of alternative investment performance by a team at JP Morgan according to Barron’s .
The bank predicts a 38% jump for bitcoin next year — enough to get it out of a bear market. A 38% increase from current levels would take bitcoin to $27,250, meaning it still needs to more than double from there to regain the record.
If seasonal trends hold, the aforementioned VanEck ETFs could be in for a good October.
“However, for a final word as investors head into the month ahead, it may be worth looking at the major crypto’s historical performance in October, a month in which Bitcoin has risen an average of 33%,” Barron’s noted.
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