It’s been a tough ride for the crypto market until 2022. By November the market was down by 70 percent from its previous high at the end of November. When things were looking down and down, the FTX crash turned things even more dire. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had many dips over the years. And every time, it has bounced back with a huge rally.
For instance, in 2013, Bitcoin reached a peak of $1,160, then fell for a full year before hitting a low of $150. In 2017 it broke that record, and hit a new high of $19,600. In 2018, the price was at $3,100. In the year 2020 it struck through the resistance and hit a new peak of $68,000 in the month of November 2021. Then, just like that we’ve witnessed another drop. But history shows us that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs are usually followed by a long bull run, which eventually overcomes the resistance set by the previous market’s highest price. This pattern can be seen not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in recent years. With more and better companies and industries embracing it, its usage and acceptance is growing. From gaming to finance cryptocurrency is being utilized in a variety of ways. And this growing use case can lead to more people being involved in the crypto market which could drive the prices up.
The rise in interest of institutions in cryptocurrency
In the last few years we’ve witnessed a rising curiosity from institutions investing in cryptocurrency. From hedge funds to banks, many large institutions are now exploring the possibilities of crypto assets. This increased interest from institutions could provide more stability to the crypto market and could lead to higher prices.
Regulations of the government
As the market for crypto grows as it matures, governments all over the world are starting to create more favorable regulations for crypto. This could help attract more investors and increase the adoption rate of crypto.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrencies, blockchain, offers a variety of possible applications beyond just financial transactions. In addition to supply chain management, voting and other systems industries are beginning to look at ways they can benefit from blockchain technology. This will stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the beginning 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 caused due to the COVID-19 pandemic, as well as other causes many investors are beginning to look for safe haven assets like gold and crypto. As the global economic situation remains 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 ones showing interest in crypto. Retail investors, also known as individual investors are also beginning to participate in the crypto market. In the future, as more people learn about crypto and how to invest in it This could result in an increase in demand and consequently higher prices.
Growing awareness and acceptance of crypto
As the crypto market grows increasing numbers of people are starting to learn about and appreciate it. As the awareness and acceptance of crypto grows it could result in increasing numbers of people purchasing or holding cryptocurrency, and this could raise prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market that allows the provision of financial services created using blockchain technology. As DeFi continues to grow and more projects and platforms are launched, it could lead to increased adoption and increased prices for crypto.
Developments in crypto payment methods
As the crypto market is growing increasing numbers of companies are starting using crypto to be a method of payment. This could lead to increased use of crypto in everyday transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
Sovereign wealth funds, which are state-owned investment vehicles, are starting to explore cryptocurrency as a possible asset class. As more of these funds devote a percentage or their entire portfolios to cryptocurrency, it could result in a rise in demand and higher prices.
Cryptocurrency is used for international payments
One of the main advantages of crypto is the ability to facilitate quick and inexpensive cross-border payments. As more businesses and individuals begin to use cryptocurrency for international transactions, this could lead to increased demand and higher prices.
An increasing number of crypto ATM’s
As the number of ATMs for crypto increase it will be easier for consumers to purchase and hold crypto, which could drive up demand and prices.
Security tokens are developed for development
Security tokens, or digital assets that represent ownership of an asset, such as stock or real estate is a fast-growing sector of the crypto market. With the increasing number of security tokens being issued and traded, this could result in a rise in demand and consequently higher costs for cryptocurrency.
A greater adoption rate by merchants
As more and more retailers accept crypto as a form of payment, it will make it more convenient for people to hold and use cryptocurrency, which will increase demand and price.
So, is crypto likely to grow in 2023? The only way to know is time. However, with these aspects being considered, it’s likely that the cryptocurrency market will be able to see a rebound in 2023. And for those who are looking to invest for the long run, being patient and disciplined is crucial.