It’s been a rough experience for the crypto market until 2022. As of November the market had dropped by 70 percent from the previous high in November 2021. And just when things were getting worse after the FTX crash turned things more dire. 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 drops in the past. And every time, it has bounced back with a big increase.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for over a year before hitting a low of $150. However, in 2017, it broke the record and reached a new highest of $19,600. Then, in 2018, and it was trading at $3,100. And in 2020, it broke through the resistance, and reached a record high of $68,000 in November 2021. Just like that, we’ve seen another dip. However, history has shown us that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips are usually followed by a long bull run that eventually breaks through the resistance created by the previous market’s highest 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 businesses and industries taking to the technology, its use and acceptance is rising. From finance to gaming cryptocurrency is being utilized in a variety of ways. And this growing use case could lead to more people getting involved in the crypto market, which in turn could increase the price.
A rise in the interest of institutions for cryptocurrency
In the last few years we’ve witnessed a rising interest from institutional investors in crypto. From banks to hedge funds and even large corporations are starting to explore the possibilities of crypto assets. The increasing interest from institutions could provide more stability to the market for crypto and result in more expensive prices.
Regulations from the Government
As the crypto market is maturing as it matures, governments all over the world are beginning to establish more favorable rules for crypto. This will help draw more investors and boost the acceptance of crypto in general.
A broader range of blockchain applications
The underlying technology behind the majority of cryptocurrencies, blockchain offers a variety of applications that go that go beyond financial transactions. From supply chain management to voting systems, more companies are beginning to look at ways they can utilize blockchain technology, which could stimulate more investment and excitement in crypto.
Technology advancements
Blockchain and cryptocurrency technology is still in the beginning stages of development. As progress is made in areas like security and scalability, the potential of cryptocurrency assets will continue to grow. This could lead to more acceptance and higher prices.
Rising global economic uncertainty
In the current instability in the economy caused through the COVID-19 pandemic as well as other factors, more and more investors are looking for safe haven assets such as cryptocurrency and 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
Investors from institutions aren’t the only people who are interested in crypto. Retail investors, also known as individual investors, are also starting to invest in the market for crypto. With increasing numbers of people become aware of cryptocurrency and investing in it This could result in an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the market for crypto continues to mature as more and more people are starting to learn about and appreciate it. As the awareness and acceptance grows of crypto it could result in more people buying or holding cryptocurrency, and this can increase prices.
apy crypto price
Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market that enables finance services created using blockchain technology. As DeFi grows and more projects and platforms become available, this will lead to a rise in adoption and more expensive prices for crypto.
Advances in crypto-based payment methods
As the crypto market is growing, more and more companies are beginning using crypto to be a form 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 investment vehicles, are now beginning to explore cryptocurrency as a possible asset class. As more funds allocate a portion or their entire portfolios to cryptocurrency, this could increase demand and increased prices.
Use of crypto for cross-border payments
One of the major benefits of crypto is the ability to facilitate quick and inexpensive cross-border payments. As more individuals and businesses are beginning to make use of crypto for international transactions, it could result in increased demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of crypto ATM’s continue to grow, it will become easier for consumers to purchase and store crypto, which could increase demand and price.
Development of security tokens
Security tokens, which are digital assets that represent ownership of an asset, such as stocks or real estate are rapidly expanding sector of the crypto market. Since more and more security tokens will be issued and traded, it could result in a rise in demand and higher costs for cryptocurrency.
A greater adoption rate by merchants
With the increasing number of businesses accept cryptocurrency as a method of payment, it will make it easier for customers to use and hold cryptocurrency, which will increase demand and price.
So, will crypto increase in 2023? It’s only time to find out. However, with these aspects in mind, it’s possible that the crypto market will have a rebound by 2023. And for those who are looking to invest for the long run patience and discipline will be key.