It’s been a rough journey for the cryptocurrency market in 2022. In November the market was down by more than 70 percent from the previous high at the end of November. Just when the market was going downhill after the FTX crash turned things even worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced many dips in the past. And every time, it’s rebounded with a huge rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for more than a year before reaching a bottom of $150. However, in 2017, it broke the record and hit a record high of $19,600. Then, in 2018, it was trading at $3,100. And in 2020, the price broke through the resistance, and reached a record high of $68,000 in November 2021. And just like that, we’ve had another dip. But history shows us that following each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
As we’ve seen in the past, dips tend to be followed by a lengthy bull run that eventually breaks through the resistance created by the previous high price. This pattern is evident in more than Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in the last few years. With more and better companies and industries embracing the technology, its use and acceptance is increasing. From finance to gaming cryptocurrency is being utilized in a myriad of ways. The growing popularity of crypto could lead to more people getting involved in the market and, in turn, increase the price.
A rise in the interest of institutions for cryptocurrency
In recent times we’ve witnessed a rising interest from institutional investors in cryptocurrency. From banks to hedge funds and even large corporations are now exploring the potential of crypto assets. The increased interest of institutions could bring more stability to the crypto market 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 rules for crypto. This could help attract more investors and boost the adoption rate of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrencies, blockchain, is a broad range of potential use cases beyond just financial transactions. For example, from supply chain management and voting, many companies are starting to explore how they can utilize blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Technology advancements
Blockchain and cryptocurrency technology is still in the early stages of development. As progress is made in areas such as security and scalability, the potential of cryptocurrency assets will continue to increase. This could lead to greater use and increase in prices.
Uncertainty in the global economy
With the ongoing instability in the economy caused by the COVID-19 pandemic, as well as other causes increasing numbers of investors are looking for safe haven assets such as bitcoin and even gold. Because the global economic climate is uncertain it could result in more demand for crypto as well as more expensive prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in people who are interested in cryptocurrency. Retail investors, or individual investors are also beginning to participate in the cryptocurrency market. In the future, as more people are educated about crypto and the best ways to invest in it, this could lead to increased demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the crypto market continues to mature, more and more people are beginning to learn about and appreciate it. As the awareness and acceptance grows of crypto, it will lead to increasing numbers of people purchasing and holding crypto, which can raise prices.
alice crypto scam
The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market that allows financial services to be created using blockchain technology. As DeFi grows and more projects and platforms are launched, it could result in increased use and higher prices for crypto.
Developments in crypto payment methods
As the market for crypto is growing as more and more businesses are starting using crypto to be a method of payment. This could lead to increased use of crypto in everyday transactions and higher prices.
Increased investment from sovereign wealth funds
These funds are owned by the state as instruments for investing, are now beginning to explore crypto as a potential asset class. As more of these funds allocate a portion of their assets to digital currencies, this could result in a rise in demand and more expensive prices.
Utilization of crypto to make cross-border payments
One of the biggest benefits of crypto is its capability to perform quick and inexpensive cross-border payments. As more and more people and businesses are beginning to make use of cryptocurrency for international transactions, this could lead to increased the demand for it and a rise in prices.
An increasing number of crypto ATM’s
With the amount of ATMs for crypto continue to grow, it will become easier for individuals to purchase and store crypto, which will drive up demand and prices.
Development of security tokens
Security tokens, also known as digital assets that are used to represent ownership in an asset such as real estate or stock, are a rapidly growing sector of the crypto market. As more security tokens are created and traded, this could lead to increased demand, and thus higher costs for cryptocurrency.
A greater adoption rate by merchants
As more and more merchants begin accepting crypto as a means of payment, this will make it more convenient for people to use and hold crypto, which could increase demand and price.
So, is crypto likely to rise in 2023? The only way to know is time. However, with these aspects to consider, it’s likely that the crypto market could have a rebound by 2023. And for those who are committed to the long haul, being patient and disciplined is essential.