It’s been a rough experience for the crypto market through 2022. As of November the market had dropped by 70% from its previous peak in November 2021. When things were looking down and down, the FTX crash turned things even more dire. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had its fair share of drops in the past. And every time, it’s rebounded by a massive rise.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for more than a year, reaching a low of $150. However, 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 through that resistance and reached a new highest of $68,000 in November 2021. And just like that, we’ve had another dip. However, the past has proven that following 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 typically followed by a prolonged bull run, which eventually overcomes the resistance set by the previous high price. This pattern is evident not only in 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 businesses and industries adopting the technology, its use and acceptance is growing. From finance to gaming, crypto is being used in a variety of ways. And this growing use case could lead to more people getting involved in the market which could boost prices.
Increased institutional interest in crypto
In recent years we’ve noticed a growing interest from institutional investors in cryptocurrency. From hedge funds to banks, many large institutions are starting to explore the potential for crypto-based assets. The increasing interest from institutions could bring more stability to the crypto market and could lead to higher prices.
Regulations from the Government
As the market for crypto continues to mature and mature, governments across the globe are beginning to develop more favorable rules for cryptocurrency. This is likely to attract more investors and boost the adoption rate of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrencies, blockchain, offers a variety of possible applications beyond just financial transactions. For example, from supply chain management and voting, many and more industries are starting to explore how they can benefit from blockchain technology. This could drive more investment and interest in crypto.
Technology advancements
Blockchain and cryptocurrency technology is still in the early stages of development. As advancements continue to be made in areas such as scalability and security, the potential of crypto assets will expand. This could result in more use and increase in prices.
Global economic uncertainty is growing
In the current instability in the economy caused due to the COVID-19 pandemic and other factors increasing numbers of investors are starting to look for safe haven assets like bitcoin and even gold. Because the global economic climate is uncertain it could result in more demand for crypto as well as more expensive prices.
Interest from retail investors
The institutional investors aren’t alone in people who are interested in crypto. Retail investors, or individual investors, are also starting to invest in the market for crypto. In the future, as more everyday people learn about cryptocurrency and investing in it, this could lead to an increase in demand and consequently higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market continues to mature, more and more people are beginning to learn about and appreciate it. As awareness and acceptance of cryptocurrency grows it could result in more people buying or holding cryptocurrency, and this can drive up prices.
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The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market, which allows finance services built using blockchain technology. As DeFi grows and more platforms and projects become available, this will lead to a rise in adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the market for crypto continues to grow, more and more companies are starting using crypto to be a form of payment. This could lead to an increase in the use of crypto in everyday transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
The sovereign wealth fund, also known as owned by the state as investments, are starting to show interest in cryptocurrency as a possible asset class. As more funds devote a percentage of their assets to digital currencies, it could lead to increased demand and increased prices.
Cryptocurrency is used for international payments
One of the major benefits of crypto is the ability to make swift and affordable cross-border transactions. As more individuals and businesses are beginning to make use of cryptocurrency for international transactions, it could result in increased demand and higher prices.
Increasing numbers of crypto ATM’s
The number of ATMs for crypto continue to grow it will be easier for individuals to purchase and store crypto, which will boost demand and increase prices.
The development of security tokens
Security tokens, which are digital assets that are used to represent ownership of an asset, such as real estate or stock are rapidly expanding area of the crypto market. As more security tokens are created and traded, this can lead to a higher demand and higher prices for crypto.
A greater adoption rate by merchants
In the event that more retailers accept crypto as a means of payment, this will make it more convenient for people to hold and use crypto, which could increase demand and price.
Will crypto be on the grow in 2023? The only way to know is time. However, with these aspects to consider, it’s possible that the crypto market could have a rebound by 2023. If you’re committed to the long haul Being patient and disciplined is crucial.