It’s been a tough ride for the crypto market through 2022. As of November, the market had dipped by 70 percent from the previous high on November 20, 2021. Just when the market was going downhill and down, the FTX crash made them look even worse. What is the likelihood that the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had its fair share of drops in the past. Every time, it’s bounced back with a huge rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for more than a year before reaching a bottom of $150. In 2017, it broke the record, and hit a new high of $19,600. In 2018, it was trading at $3,100. And in the year 2020 it struck that resistance, and reached a record highest of $68,000 in November 2021. Then, just like that we’ve had another dip. However, history has shown us that at the end of every dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen in the past, dips tend to be followed by a prolonged bull run that finally breaks through the resistance created by the market’s previous highest price. This pattern can be seen in more than Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has made significant progress in the last few years. With more and more companies and industries adopting it, its usage and acceptance is rising. From banking to gaming, crypto is being used in a variety of ways. The growing popularity of crypto could result in increasing participation in the crypto market, which in turn could increase the price.
The rise in interest of institutions in crypto
In recent times we’ve noticed a growing demand from investors of institutional scale in cryptocurrency. From banks to hedge funds, many large institutions are beginning to investigate the possibilities for crypto-based assets. The increased interest of institutions could provide more stability to the crypto market and could lead to higher prices.
Regulations of the government
As the crypto market is maturing and mature, governments across the globe are beginning to develop more favorable regulations for crypto. This could help attract more investors and increase the adoption rate of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrency, blockchain, has a wide range of applications that go that go beyond financial transactions. From supply chain management to voting systems, more and more industries are beginning to look at ways they can utilize blockchain technology. This could increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Blockchain and cryptocurrency technology is still in the beginning stages of development. As advancements continue to be made in areas like scalability and security, the potential of crypto assets will continue to expand. This could lead to more adoption and higher prices.
Rising global economic uncertainty
Due to the constant economic uncertainty brought on by the COVID-19 pandemic and other factors many investors are starting to look for safe haven investments like cryptocurrency and gold. As the global economic situation remains uncertain, this could lead to increased demand for crypto and increased prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in people who are interested in cryptocurrency. Retail investors, or even individual investors, are also starting to participate in the crypto market. In the future, as more people are educated about crypto and the best ways to invest in it This could result in an increase in demand and consequently higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market is maturing increasing numbers of people are starting to learn about and understand the concept. As awareness and acceptance grows of crypto it could result in more people purchasing and holding crypto, which can raise prices.
3 bar play crypto
Decentralized finance (DeFi) is a rapidly growing area of the crypto market, which allows financial services to be built upon blockchain technology. As DeFi grows and more projects and platforms are launched, it will lead to a rise in adoption and higher prices for crypto.
The development of crypto payment methods
As the crypto market is growing increasing numbers of companies are beginning accepting crypto payments as a means of payment. This could result in increased usage of crypto in daily transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are owned by the state as investments, are starting to explore cryptocurrency as a possible asset class. As more funds devote a percentage of their portfolio to crypto, this could increase demand and higher prices.
Utilization of crypto to make international payments
One of the main advantages of cryptocurrency is its ability to make fast and cheap cross-border payments. As more businesses and individuals start to utilize cryptocurrency for international transactions, it could result in increased demand and higher prices.
Increasing numbers of crypto ATM’s
The number of crypto ATM’s continue to grow it will be easier for people to buy and keep crypto, which could increase demand and price.
The development of security tokens
Security tokens, also known as digital assets that represent ownership of an asset, like real estate or stock are rapidly expanding sector of the crypto market. With the increasing number of security tokens being issued and traded, this could lead to increased demand and higher prices for crypto.
More adoption by merchants
With the increasing number of businesses begin accepting cryptocurrency as a method of payment, this will make it more convenient for people to utilize and store crypto, which could drive up demand and prices.
So, is crypto likely to grow in 2023? The only way to know is time. However, with these aspects in mind, it’s likely that the crypto market will see a recovery in 2023. If you’re committed to the long run Being patient and disciplined will be key.