It’s been a tough experience for the crypto market until 2022. In November the market had dropped by more than 70 percent from the previous high in November 2021. Just when the market was getting worse and down, the FTX crash made them look more dire. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen its fair share of drops in the past. Each time, it’s bounced back with a huge rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for over a year, reaching a low of $150. In 2017 it broke that record, and hit a new record high of $19,600. Then, in 2018, and it was trading at $3,100. And in 2020, the price broke through that resistance and hit a new peak of $68,000 in the month of November 2021. And just like that, we’ve witnessed another drop. 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 in the past, dips are typically followed by a long bull run that finally overcomes the resistance set by the market’s previous highest 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 come a long way in the last few years. With more and better companies and industries adopting the technology, its use and acceptance is increasing. From gaming to finance cryptocurrency is being utilized in a myriad of ways. This growing demand could lead to increasing participation in the crypto market and, in turn, drive the prices up.
Increased institutional interest in crypto
In recent times we’ve witnessed a rising interest from institutional investors in crypto. From hedge funds to banks and even large corporations are now exploring the potential of crypto assets. This increased interest from institutions can bring stability to the market for crypto and lead to greater prices.
Regulations from the Government
As the market for crypto is maturing as it matures, governments all over the world are beginning to develop more favorable rules for cryptocurrency. This could help attract more investors and increase the adoption rate of crypto.
Blockchain has many more applications.
The technology that underlies many cryptocurrency, blockchain, offers a variety of possible applications that go beyond financial transactions. From supply chain management to voting systems, more companies are beginning to look at ways they can benefit from blockchain technology, which could stimulate more investment and excitement in cryptocurrency.
Blockchain technology and cryptography are still in the early stages of development. As advances continue to be made in areas such as scalability and security, the potential of crypto assets will continue to expand. This could lead to greater acceptance and higher prices.
Rising global economic uncertainty
With the ongoing economic uncertainty brought on through the COVID-19 pandemic as well as other factors increasing numbers of investors are looking for safe haven investments like bitcoin and even gold. Since the economic outlook for the world remains uncertain and uncertain, this could lead to an increase in demand for crypto and increased prices.
Interest from retail investors
The institutional investors aren’t alone in people who are interested in cryptocurrency. Retail investors, or individual investors are also beginning to get involved in the crypto market. As more and more people are educated about crypto and how to invest in it, this could lead to an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto is maturing as more and more people are beginning to learn about it and comprehend the concept. As awareness and acceptance of crypto grows, this could lead to more people purchasing and holding crypto, which can raise prices.
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Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market that allows the provision of financial services created on top of blockchain technology. As DeFi continues to grow and more platforms and projects become available, this will lead to a rise in adoption and more expensive prices for crypto.
The development of crypto payment methods
As the market for crypto is growing as more and more businesses are beginning accepting crypto payments as a form of payment. This could result in increased usage of crypto in daily transactions, and a rise in prices.
The increased investment of sovereign wealth funds
Sovereign wealth funds, which are owned by the state as investment vehicles, are beginning to show interest in crypto as an asset class. As more funds dedicate a part of their assets to digital currencies, it could increase demand and increased prices.
Cryptocurrency is used for cross-border payments
One of the main advantages of crypto is the ability to make quick and inexpensive cross-border payments. As more businesses and individuals begin to use cryptocurrency for international transactions this can lead to a rise in the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
As the number of ATMs that accept crypto continue to grow it will be more convenient for people to buy and store crypto, which could increase demand and price.
Security tokens are developed for development
Security tokens, also known as digital assets that signify ownership of an asset, such as real estate or stock are rapidly expanding area of the crypto market. Since more and more security tokens will be created and traded, it can lead to a higher demand and higher rates for the crypto.
Merchants are more likely to adopt the concept.
As more and more retailers accept crypto as a means of payment, it will make it more convenient for consumers to utilize and store crypto, which could boost demand and increase prices.
Will crypto be on the grow in 2023? It’s only time to find out. However, with these aspects being considered, it’s possible that the crypto market could be able to see a rebound in 2023. And for those who are in it for the long-term patience and discipline is crucial.