According to research shared by local crypto exchange Korbit, he predicted that the crypto winter will continue for months but will end before the end of the fourth quarter of the fiscal year. Researchers examined trends seen in previous crypto winters and found similarities with the decline that began in late 2018. Jeong Seok-moon, head of Korbit's research unit, says this market downturn is similar to the third crypto winter the market has experienced between 2018 and early 2019.

Jeong said the Fed's tightening policies triggered a decline in late 2018. He stated that this decline is unlike the first and second crypto winters caused by factors in the crypto market. For this reason, Jeong added that those making predictions about the timing of the crypto market should heed the predictions of when the Fed's monetary policy will change.

While they expect a change in the fourth quarter, Korbit researchers say that inflation will gradually decrease in the second quarter of the year and more positive news will come from the ISM index.

crypto winter

Korbit's researchers and Bithumb's researchers agree. According to Hanguk Kyungjae, Bithumb's Head of Research Lee Mi-sun said that the Fed's rate hike probably won't last long. He said the Fed will likely start lowering rates once again before the end of this calendar year. According to Lee, Bitcoin prices will bottom out in the second half of the calendar year and will show signs of stabilization towards the end of the year.

“Cryptocurrencies are critical to the future of finance”

Eddie Yue, CEO of the Hong Kong Monetary Authority (HKMA), said that despite the shortcomings in the cryptocurrency sector, the industry is likely to play an important role in future financial systems.

Speaking at the meeting of G20 financial officials, Yue said the technology that powers most cryptocurrency projects can be adapted to fit the overall financial system, Reuters reported. However, Yue also called for the industry to be regulated to avoid related risks, such as the recent Terra (LUNA) ecosystem collapse, which resulted in significant losses.