It’s been a difficult experience for the crypto market through 2022. By November the market had dropped by more than 70 percent from its previous high in November 2021. When things were looking down and down, the FTX crash turned things even worse. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has had many dips over the years. Every time, it’s bounced back with a huge increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for more than a year, reaching a low of $150. But, in 2017, it broke that record and reached a new high of $19,600. In 2018, the price was at $3,100. In 2020, it broke through that resistance and hit a new highest of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. However, history has shown us that following each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
As we’ve seen previously, dips tend to be followed by a lengthy bull run that finally overcomes the resistance set by the previous market’s highest price. This pattern can be seen not only in Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in recent years. With more and more companies and industries embracing the technology, its use and acceptance is rising. From finance to gaming, crypto is being used in a variety of ways. And this growing use case could result in increasing participation in the crypto market and, in turn, drive the prices up.
The rise in interest of institutions in cryptocurrency
In recent years, we’ve seen a growing curiosity from institutions investing in cryptocurrency. From hedge funds to banks and even large corporations are now exploring the potential in crypto currencies. The increasing interest from institutions can bring stability to the crypto market and could lead to higher prices.
Regulations of the government
As the market for crypto is maturing and mature, governments across the globe are beginning to develop more favorable rules for cryptocurrency. This will help draw more investors and boost the adoption rate of crypto.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrency, blockchain, is a broad range of applications that go that go beyond financial transactions. From supply chain management to voting systems, more industries are exploring ways they can benefit from blockchain technology. This will drive more investment and interest in cryptocurrency.
Technology advancements
Crypto and blockchain technology are at the very beginning of development. As advances continue to be made in areas like security and scalability, the potential of crypto assets will continue to increase. This could lead to more use and increase in prices.
Global economic uncertainty is growing
With the ongoing instability in the economy caused through the COVID-19 pandemic and other factors, more and more investors are beginning to look for safe haven investments like bitcoin and even gold. Because the global economic climate remains uncertain and uncertain, this could lead to increased demand for crypto and more expensive prices.
Interest from retail investors
The institutional investors aren’t alone in one who’s showing an interest in crypto. Retail investors, or even individual investors, are also starting to participate in the cryptocurrency market. As more and more everyday people become aware of crypto and the best ways to invest in it This could result in more demand and higher prices.
Growing awareness and acceptance of crypto
As the crypto market grows, more and more people are beginning to become aware about it and comprehend the concept. As the awareness and acceptance of crypto grows it could result in increasing numbers of people purchasing or holding cryptocurrency, and this could raise prices.
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Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market that enables finance services developed using blockchain technology. As DeFi expands and more platforms and projects become available, this could lead to increased adoption and higher prices for crypto.
The development of crypto payment methods
As the crypto market continues to grow as more and more businesses are beginning to accept crypto as a means of payment. This could result in increased use of crypto in everyday transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are owned by the state as investments, are now beginning to look at crypto as a potential asset class. As more of these funds allocate a portion of their assets to digital currencies, it could lead to increased demand and more expensive prices.
Utilization of crypto to make payment across borders
One of the biggest benefits of crypto is the capability to perform quick and inexpensive cross-border payments. As more individuals and businesses start to utilize cryptocurrency for international transactions, this can lead to a rise in demand and higher prices.
The number of ATMs that accept crypto is increasing.
As the number of ATMs for crypto continue to grow it will be easier for individuals to purchase and hold cryptocurrency, which can boost demand and increase prices.
The development of security tokens
Security tokens, which are digital assets that are used to represent ownership of an asset, such as real estate or stock is a fast-growing sector of the crypto market. Since more and more security tokens will be created and traded, this could lead to increased demand and higher rates for the crypto.
More adoption by merchants
With the increasing number of retailers start accepting crypto as a means of payment, this makes it easier for customers to hold and use crypto, which could increase demand and price.
So, will crypto rise in 2023? Only time will tell. With these things to consider, it’s possible that the cryptocurrency market will be able to see a rebound in 2023. For those in it for the long-term Being patient and disciplined will be key.