### 2022 is ending with rapid fire FUD on crypto. Can we look forward to a positive 2023 for crypto? We might be in for more pain. Amidst this challenging backdrop, Blackrock ($8T hedgefund) has some sobering forecasts for 2023 that hints of prolonged pain for the cryptocurrency market. 

The domino effect of the FTX collapse is still unfolding, and crypto users remain on edge over the uncertainty of the DCG group (Genesis, Greyscale), which will potentially have its own ripple effect. 

The worlds largest centralized exchange is also being heavily attached by Kevin O'Leary and many other crypto personalities. Blackrock published its outlook for 2023, which can be viewed [here](https://www.blackrock.com/corporate/literature/whitepaper/bii-global-outlook-2023.pdf). 

 Blackrock believes that recession is all but certain, and central banks won't come to the rescue like before. This is because the current inflationary environment has the central bank engineering (deliberately causing) the recession in order to moderate demand. Part of the reason inflation is raging is that there are issues with production, and ultimately supply. 

As supply is lagging behind strong demand, Central Banks are not equipped nor designed to assist in solving supply issues. Central Banks have only a few tools, including the funding rate which negatively affects demand but does not address the supply problem. 

Thus, production issues will need to be sorted out along with other sources of inflation and this could take time. And, for as long as inflation remains persistent, the funding rates will likely remain high. 

While the funding rates are high, risk assets like crypto will remain in a challenging price environment. Blackrock forecasts that Central Banks will not rescue the economy from the coming recessions in the way the market has become accustomed to because recessions will be allowed to play out so that inflation can come down. 

To make things more bleak, Blackrock also predicts that inflation will not be brought down to the 2% target within the next year, even with higher funding rates. 

Blackrock wrote: "Recession is foretold as central banks race to try to tame inflation. It's the opposite of past recessions: Loose policy is not on the way to help support risk assets, in our view. That's why the old playbook of simply "buying the dip" doesn't apply in this regime of sharper trade-offs and greater macro volatility." 

In a few weeks, this crypto winter will be by all measures the longest. Based on the forecast of Blackrock, there is good reason to expect the crypto winter to feel like an ice age as it may linger throughout 2023. 

Our analysis is that cost-averaging may not be a good strategy for altcoins in 2023. In 2022, the vaunted ETH killer, SOL fell out of the top 10. Another similarly situation 'ETH' killer ADA has been on an unending downard trend that punished cost-averagers throughout 2022. 

For 2023, the risk-return of altcoins make them a poor option with money probably better spent on other assets. The altcoin market may be in for another huge set of drops as all risk assets will likely continue to receive downward price pressure from global central bank policy. 

We still believe that cost averaging of BTC and ETH is still a good idea in 2023, given a longterm approach. Both assets have shown very strong long-term growth potential, there being more risk in NOT buying those assets. However, the short-term looks to be choppy, and a weak 2023 is probable if Blackrock's expectation's become reality. 

Thus, any costaveraging strategy should be biased toward sustainability rather than being aggressive so as to be not overly burdensome. It may be well over a year before BTC and ETH see a convincing change in trend. (Our analysis is not financial advice.) 

2022 is ending with rapid fire FUD on crypto. Can we look forward to a positive 2023 for crypto? We might be in for more pain. Amidst this challenging backdrop, Blackrock ($8T hedgefund) has some sobering forecasts for 2023 that hints of prolonged pain for the cryptocurrency market. 

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Mon Dec 19 2022 Amidst FUD, Blackrock Gives More Reasons to Be Bearish For 2023 [Analysis and Opinion]

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