It’s been a rough ride for the crypto market through 2022. By November, the market had dipped by 70 percent from the previous high at the end of November. When things were looking down and down, the FTX crash turned things more dire. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had its fair share of drops in the past. Each time, it’s bounced back with a big rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for more than a year before hitting a low of $150. But, in 2017, it broke the record and reached a new high of $19,600. Fast forward to 2018, the price was at $3,100. And in the year 2020 it struck through the resistance and hit a new peak of $68,000 in the month of November 2021. And 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
As we’ve seen in the past, dips are usually followed by a lengthy bull run, which eventually breaks through the resistance created by the market’s previous highest price. This pattern is evident in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in the last few years. With more and more companies and industries embracing it, its usage and acceptance is increasing. From finance to gaming, crypto is being used in a variety of ways. The growing popularity of crypto can lead to increasing participation in the crypto market and, in turn, drive the prices up.
Increased institutional interest in crypto
In recent years we’ve noticed a growing interest from institutional investors in cryptocurrency. From banks to hedge funds numerous large institutions are now exploring the possibilities in crypto currencies. The increased interest of institutions could bring more stability to the market for crypto and result in higher prices.
Regulations of the government
As the market for crypto is maturing as it matures, governments all over the world are beginning to develop more favorable regulations for cryptocurrency. This will help draw more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrencies, blockchain, is a broad range of applications that go that go beyond financial transactions. For example, from supply chain management and voting, many companies are exploring ways they can utilize blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Crypto and blockchain technology are still in the early stages of development. As advancements continue to be made in areas such as security and scalability, the potential of crypto assets will increase. This could lead to greater adoption and higher prices.
Rising global economic uncertainty
In the current instability in the economy caused due to the COVID-19 pandemic, as well as other causes increasing numbers of investors are beginning to look for safe haven assets such as bitcoin and even gold. As the global economic situation remains uncertain and uncertain, this could lead to an increase in demand for crypto and increased prices.
Interest from retail investors
Investors from institutions aren’t the only ones showing interest in crypto. Retail investors, or even individual investors are also beginning to participate in the market for crypto. In the future, as more people are educated about cryptocurrency and investing in it, this could lead to more demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto is maturing, more and more people are beginning to learn about it and comprehend it. As the awareness and acceptance grows of crypto, it will lead to more people purchasing or holding cryptocurrency, and this can drive up prices.
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Decentralized finance (DeFi) is a rapidly growing area of the crypto market that enables financial services to be created on top of blockchain technology. As DeFi expands and more projects and platforms become available, this will lead to a rise in adoption and increased prices for crypto.
Developments in crypto payment methods
As the market for crypto continues to grow, more and more companies are starting accepting crypto payments as a form of payment. This could lead to increased use of crypto in everyday transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
These funds are owned by the state as investments, are now beginning to show interest in cryptocurrency as a possible asset class. As more funds allocate a portion of their portfolio to crypto, this could result in a rise in demand and more expensive prices.
Utilization of crypto to make payment across borders
One of the main advantages of crypto is its ability to facilitate fast and cheap cross-border payments. As more and more people and businesses begin to use crypto for international transactions, this can lead to a rise in demand and higher prices.
The number of ATMs that accept crypto is increasing.
With the amount of ATMs that accept crypto continue to increase it will be easier for people to buy and store cryptocurrency, which can boost demand and increase prices.
Security tokens are developed for development
Security tokens, or digital assets that are used to represent ownership of an asset, such as real estate or stock are rapidly expanding 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 thus higher rates for the crypto.
Merchants are more likely to adopt the concept.
In the event that more businesses accept cryptocurrency as a method of payment, it will make it easier for consumers to use and hold cryptocurrency, which will boost demand and increase prices.
So, will crypto rise in 2023? It’s only time to find out. With these things in mind, it’s likely that the crypto market will see a recovery in 2023. And for those who are in it for the long haul Being patient and disciplined is crucial.