It’s been a rough journey for the cryptocurrency market through 2022. As of November the market had dropped by more than 70% from its previous peak at the end of November. Just when the market was going downhill and down, the FTX crash made them look even worse. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced its fair share of dips over the years. Every time, it’s bounced back with a big rise.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year before reaching a bottom of $150. In 2017, it broke that record and hit a record highest of $19,600. In 2018, it was trading at $3,100. In the year 2020 it struck that resistance, and reached a record peak of $68,000 in the month of November 2021. And just like that, we’ve had another dip. However, history has shown us that following each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen in the past, dips tend to be followed by a lengthy bull run that eventually breaks through the resistance created by the market’s previous highest price. This is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have progressed a lot in the last few years. With more and better companies and industries taking to it, its usage and acceptance is rising. From gaming to finance, crypto is being used in a variety of ways. And this growing use case can lead to more people being involved in the crypto market which could increase the price.
The rise in interest of institutions in cryptocurrency
In recent years we’ve noticed a growing demand from investors of institutional scale in crypto. From hedge funds to banks numerous large institutions are starting to explore the possibilities for crypto-based assets. The increasing interest from institutions could provide more stability to the crypto market 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 cryptocurrency. This will help draw more investors and boost the mainstream adoption of crypto.
More use cases for blockchain
The technology that underlies the majority of cryptocurrencies, blockchain has a wide range of possible applications beyond the realm of financial transactions. In addition to supply chain management, voting and other systems industries are starting to explore how they can benefit from blockchain technology. This will increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Blockchain technology and cryptography are still in the early stages of development. As progress is made in areas like security and scalability, the potential of crypto assets will expand. This could lead to greater acceptance and higher prices.
Uncertainty in the global economy
In the current economic uncertainty caused by the COVID-19 pandemic and other factors, more and more investors are beginning to look for safe haven assets such as cryptocurrency and gold. Since the economic outlook for the world remains uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Interest from retail investors
The institutional investors aren’t alone in people who are interested in crypto. Retail investors, also known as individual investors are also beginning to invest in the crypto market. As more and more people become aware of crypto and the best ways to invest in it This could result in an increase in demand and consequently higher prices.
The growing awareness and acceptance of cryptocurrency
As the crypto market is maturing increasing numbers of people are beginning to learn about it and comprehend it. As understanding and acceptance of cryptocurrency grows it could result in more people purchasing and holding crypto, which can drive up prices.
best crypto exchange for ripple
Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market, which allows the provision of financial services created on top of blockchain technology. As DeFi grows and more projects and platforms come online, this could result in increased use and higher prices for crypto.
Developments in crypto payment methods
As the crypto market is growing increasing numbers of companies are beginning accepting crypto payments as a means of payment. This could lead to increased usage of crypto in daily transactions, and a rise in prices.
The increased investment of sovereign wealth funds
These funds are owned by the state as investment vehicles, are now beginning to look at cryptocurrency as a possible asset class. As more of these funds allocate a portion or their entire portfolios to cryptocurrency, this could lead to increased demand and higher prices.
Use of crypto for international payments
One of the biggest benefits 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 could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of ATMs that accept crypto continue to increase, it will become easier for people to buy and store crypto, which could boost demand and increase prices.
The development of security tokens
Security tokens, which are digital assets that signify ownership in an asset like real estate or stock are rapidly expanding sector of the crypto market. Since more and more security tokens will be created and traded, this could result in a rise in demand and higher prices for crypto.
More adoption by merchants
With the increasing number of businesses accept cryptocurrency as a method of payment, this will make it more convenient for consumers to utilize and store crypto, which could drive up demand and prices.
So, will crypto increase in 2023? It’s only time to find out. But with these factors to consider, it’s likely that the crypto market will have a rebound by 2023. For those looking to invest for the long-term patience and discipline will be key.