It’s been a difficult ride for the crypto market until 2022. As of November, the market had dipped by 70 percent from its previous high on November 20, 2021. When things were getting worse after the FTX crash turned them even worse. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced its fair share of dips in the past. Every time, it’s bounced back with a huge rise.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for a full year before reaching a bottom of $150. However, in 2017, it broke that record, and hit a new high of $19,600. Then, in 2018, it was trading at $3,100. And in 2020, it broke through that resistance, and reached a record high of $68,000 in November 2021. And just like that, we’ve witnessed another drop. But history shows us that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips are typically followed by a prolonged bull run that finally breaks through the resistance created by the previous high price. This pattern is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in recent years. With more and more companies and industries taking to it, its usage and acceptance is growing. From finance to gaming cryptocurrency is being utilized in a variety of ways. The growing popularity of crypto can lead to increasing participation in the market, which in turn could increase the price.
Increased institutional interest in crypto
In recent years we’ve noticed a growing interest from institutional investors in cryptocurrency. From hedge funds to banks and even large corporations are beginning to investigate the possibilities in crypto currencies. The increasing interest from institutions can bring stability to the market for crypto and lead to greater prices.
Regulations of the government
As the crypto market is maturing, governments around the world are beginning to develop more favorable rules for crypto. This could help attract more investors as well as increase the mainstream adoption of crypto.
Blockchain has many more applications.
The underlying technology behind the majority of cryptocurrencies, blockchain has a wide range of potential use cases that go beyond financial transactions. For example, from supply chain management and voting, many industries are beginning to look at ways they can make use of blockchain technology. This will drive more investment and interest in crypto.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is still in the early stages of development. As advancements continue to be made in areas such as security and scalability, potential of cryptocurrency assets will continue to grow. This could lead to more acceptance and higher prices.
Rising global economic uncertainty
Due to the constant economic uncertainty caused by the COVID-19 pandemic as well as other factors, more and more investors are starting to look for safe haven assets like bitcoin and even gold. Because the global economic climate is uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in one who’s showing an interest in crypto. Retail investors, or individual investors, are also starting to invest in the market for crypto. With increasing numbers of everyday people learn about cryptocurrency and investing 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 market for crypto grows, more and more people are beginning to learn about it and comprehend the concept. As awareness and acceptance grows of crypto it could result in increasing numbers of people purchasing as well as holding the crypto that can raise prices.
anti crypto wall
The Decentralized Finance (DeFi) is an emerging area of the crypto market that allows financial services to be created using blockchain technology. As DeFi continues to grow and more platforms and projects become available, this will lead to a rise in adoption and increased prices for crypto.
The development of crypto payment methods
As the crypto market continues to grow, more and more companies are beginning accepting crypto payments as a method of payment. This could lead to increased use of crypto in regular transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned investments, are starting to show interest in cryptocurrency as a possible asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, it could lead to increased demand and more expensive prices.
Use of crypto for international payments
One of the main advantages of crypto is its ability to facilitate swift and affordable cross-border transactions. As more individuals and businesses start to utilize cryptocurrency for international transactions, it could result in increased the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
As the number of crypto ATM’s increase, it will become easier for individuals to purchase and keep crypto, which could drive up demand and prices.
Development of security tokens
Security tokens, which are digital assets that are used to represent ownership in an asset like stock or real estate, are a rapidly growing segment of the cryptocurrency market. As more security tokens are created and traded, it can lead to a higher demand and higher prices for crypto.
A greater adoption rate by merchants
In the event that more retailers start accepting crypto as a means of payment, this makes it easier for people to use and hold crypto, which can increase demand and price.
So, is crypto likely to rise in 2023? It’s only time to find out. However, with these aspects in mind, it’s likely that the crypto market will see a recovery in 2023. For those committed to the long haul Being patient and disciplined will be key.