It’s been a rough journey for the cryptocurrency market in 2022. In November the market was down by 70 percent from its previous high on November 20, 2021. When things were going downhill and down, the FTX crash made them look even more dire. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen its fair share of dips over the years. And every time, it’s rebounded with a big rally.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year before reaching a bottom of $150. In 2017, it broke the record, and hit a new record high of $19,600. Fast forward to 2018, the price was at $3,100. And in the year 2020 it struck through that resistance and hit a new peak of $68,000 in the month of November 2021. Then, just like that we’ve had another dip. But history shows us that at the end of every 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 prolonged bull run that finally overcomes the resistance set by the previous high price. This pattern is evident not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in the last few years. With more and more companies and industries embracing the technology, its use and acceptance is growing. From banking to gaming the use of crypto is increasing in a myriad of ways. The growing popularity of crypto can lead to increasing participation in the market which could boost prices.
Increased institutional interest in cryptocurrency
In the last few years, we’ve seen a growing demand from investors of institutional scale in cryptocurrency. From hedge funds to banks numerous large institutions are beginning to investigate the possibilities in crypto currencies. The increasing interest from institutions could provide more stability to the market for crypto and lead to greater prices.
Government regulations
As the market for crypto continues to mature and mature, governments across the globe are beginning to develop more favorable regulations for cryptocurrency. This will help draw more investors as well as increase the acceptance of crypto in general.
Blockchain has many more applications.
The underlying technology behind the majority of cryptocurrencies, blockchain is a broad range of potential use cases beyond just financial transactions. For example, from supply chain management and voting, many and more industries are starting to explore how they can benefit from blockchain technology. This could stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Crypto and blockchain technology are at the very beginning of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will grow. This could result in more acceptance and higher prices.
Uncertainty in the global economy
With the ongoing instability in the economy caused due to the COVID-19 pandemic as well as other factors many 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 more demand for crypto as well as increased prices.
Interest from retail investors
Institutional investors aren’t the only one who’s showing an interest in crypto. Retail investors, or even individual investors, are also starting to invest in the cryptocurrency market. In the future, as more everyday people learn about crypto and how to invest in it, this could lead to an increase in demand and consequently higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market continues to mature as more and more people are beginning to become aware about and understand the concept. As the awareness and acceptance of crypto grows it could result in more people buying as well as holding the crypto that can raise prices.
alchemist crypto price
Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market, which allows the provision of financial services built upon blockchain technology. As DeFi expands and more projects and platforms are launched, it will lead to a rise in adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the crypto market continues to grow, more and more companies are starting to accept crypto as a method of payment. This could result in increased use of crypto in everyday transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
These funds are owned by the state as instruments for investing, are starting to look at cryptocurrency as a possible asset class. As more funds allocate a portion of their assets to digital currencies, this could lead to increased demand and increased prices.
Cryptocurrency is used for payment across borders
One of the biggest benefits of crypto is its ability to make quick and inexpensive cross-border payments. As more and more people and businesses are beginning to make use of crypto for international transactions, this can lead to a rise in demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of crypto ATM’s continue to increase it will be more convenient for people to buy and keep cryptocurrency, which can boost demand and increase prices.
The development of security tokens
Security tokens, or digital assets that represent ownership in an asset like stock or real estate are rapidly expanding sector of the crypto market. Since more and more security tokens will be created and traded, this could result in a rise in demand and higher prices for crypto.
A greater adoption rate by merchants
In the event that more businesses begin accepting crypto as a means of payment, it makes it easier for people to utilize and store cryptocurrency, which will drive up demand and prices.
Will crypto be on the rise in 2023? It’s only time to find out. However, with these aspects in mind, it’s possible that the cryptocurrency market will see a recovery in 2023. And for those who are in it for the long run, being patient and disciplined will be key.