The bank has predicted that tokens that power smart contract-enabled blockchain platforms will outperform meme coins and governance tokens. These tokens are expected to have more utility and real-world applications, which will give them more value.
The cryptocurrency market is off to a much better start this year than most had expected. According to a report released by Bank of America on Friday, the token universe is up 42% year to date to $1.1 trillion.
The bank predicts that 2023 will be the year of token price divergence, with tokens that provide utility and a call on cash flows outperforming meme and governance tokens.
Bank of America strategists caution that strong economic data has delayed the timing of a recession, but also “indicates the potential for reflation and additional rate hikes.” This could lead to pressure on growth and digital assets in the long term.
Shorting is a way of betting that a price will decline. An investor borrows a security and sells it in the hope that the price will drop. They then repurchase the security and return it to the lender. Mean reversion is a theory used in finance that suggests that asset prices tend to revert to their long-term average level.
Also Read:
- “Crypto Executive Predicts Ripple’s Defeat in SEC Lawsuit Battle”
- Crypto Investors Worry as Bitcoin Falls Amidst Inflation and Rate Hike Fears
- Crypto Market Takes a $58B Hit: Bitcoin and Ethereum See Significant Dip
- “Crypto Markets Take a Hit as Wall Street Crash Wipes Out $50B: Market Analysis”
- Bitcoin’s 47% Rally Fails to Break Bearish Elliott Wave Pattern, According to QCP Capital
1 thought on “Understanding Bank of America’s 2023 Forecast: Will Crypto Token Price Divergence Benefit or Harm the Market?”