It’s been a difficult journey for the cryptocurrency market until 2022. As of November the market was down by 70 percent from its previous high on November 20, 2021. When things were looking down and down, the FTX crash turned them even more dire. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen many dips in the past. Each time, it’s rebounded by a massive increase.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for a full year before reaching a bottom of $150. But, in 2017, it broke the record, and hit a new high of $19,600. Fast forward to 2018, the price was at $3,100. And in 2020, it broke through the resistance, and reached a record high of $68,000 in November 2021. And just like that, we’ve seen another dip. However, the past has proven that after each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed previously, dips are usually followed by a long bull run, which eventually breaks through the resistance created by the previous high price. This pattern can be seen in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have made significant progress in the last few years. With more and more businesses and industries embracing the technology, its use and acceptance is increasing. From finance to gaming cryptocurrency is being utilized in a myriad of ways. And this growing use case could lead to more people getting involved in the market, which in turn could drive the prices up.
The rise in interest of institutions in cryptocurrency
In recent years we’ve witnessed a rising curiosity from institutions investing in cryptocurrency. From hedge funds to banks and even large corporations are starting to explore the potential for crypto-based assets. The increased interest of institutions can bring stability to the market for crypto and could lead to more expensive prices.
Regulations of the government
As the market for crypto is maturing as it matures, governments all over the world are starting to create more favorable rules for cryptocurrency. This could help attract more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrencies, blockchain, has a wide range of applications that go beyond just financial transactions. From supply chain management to voting systems, more companies are exploring ways they can utilize blockchain technology, which could drive more investment and interest in cryptocurrency.
Advancements in technology
Blockchain and cryptocurrency technology is at the very beginning of development. As advances continue to be made in areas like security and scalability, potential of crypto assets will expand. This could result in more use and increase in prices.
Uncertainty in the global economy
With the ongoing economic uncertainty brought on by the COVID-19 pandemic, as well as other causes increasing numbers of investors are looking for safe haven investments like bitcoin and even gold. Because the global economic climate remains uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only ones showing interest in cryptocurrency. Retail investors, or individual investors are also beginning to participate in the cryptocurrency market. In the future, as more everyday people are educated about crypto and the best ways to invest in it, this could lead to increased demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the market for crypto grows increasing numbers of people are starting to learn about it and comprehend it. As awareness and acceptance of cryptocurrency grows it could result in more people purchasing and holding crypto, which could increase prices.
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Decentralized finance (DeFi) is a rapidly growing area of the crypto market that allows finance services developed using blockchain technology. As DeFi continues to grow and more projects and platforms come online, this could lead to increased adoption and more expensive prices for crypto.
The development of crypto payment methods
As the market for crypto continues to grow increasing numbers of companies are starting to accept crypto as a method of payment. This could result in increased usage of crypto in daily transactions, and a rise in prices.
More investment from sovereign wealth funds
Sovereign wealth funds, which are state-owned investment vehicles, are beginning to explore crypto as a potential asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, it could result in a rise in demand and more expensive prices.
Utilization of crypto to make payment across borders
One of the major benefits of crypto is its capability to perform swift and affordable cross-border transactions. As more individuals and businesses start to utilize crypto for international transactions, this could lead to increased demand and higher costs.
An increasing number of crypto ATM’s
The number of ATMs for crypto continue to grow it will be easier for individuals to purchase and store cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, or digital assets that are used to represent ownership in an asset such as stock or real estate are rapidly expanding sector of the crypto market. As more security tokens are created and traded, it could lead to increased demand and higher rates for the crypto.
More adoption by merchants
With the increasing number of businesses start accepting cryptocurrency as a method of payment, it will make it easier for customers to utilize and store cryptocurrency, which will boost demand and increase prices.
So, is crypto likely to rise in 2023? Only time will tell. With these things being considered, it’s likely that the cryptocurrency market will have a rebound by 2023. If you’re committed to the long haul patience and discipline is essential.