It’s been a tough ride for the crypto market in 2022. By November the market was down by 70 percent from its previous high on November 20, 2021. When things were going downhill after the FTX crash turned things even worse. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has had many dips in the past. Each time, it has bounced back with a huge rally.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for a full year before hitting a low of $150. But, in 2017, it broke the record, and hit a new highest of $19,600. Then, in 2018, and it was trading at $3,100. And in 2020, it broke that resistance, and reached a record highest of $68,000 in November 2021. Then, just like that we’ve seen another dip. But history shows us that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs are typically followed by a lengthy bull run, which eventually surpasses the resistance created by the previous high price. This pattern is evident in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in the last few years. With more and more companies and industries taking to the technology, its use and acceptance is rising. From finance to gaming the use of crypto is increasing in a variety of ways. This growing demand can lead to more people getting involved in the crypto market, which in turn could increase the price.
Increased institutional interest in cryptocurrency
In the last few years we’ve noticed a growing demand from investors of institutional scale in crypto. From hedge funds to banks and even large corporations are starting to explore the potential for crypto-based assets. The increasing interest from institutions can bring stability to the market for crypto and lead to higher prices.
Regulations from the Government
As the market for crypto grows as it matures, governments all over the world are beginning to establish more favorable regulations for crypto. This is likely to attract more investors as well as increase the mainstream adoption of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrency, blockchain, offers a variety of applications that go that go beyond financial transactions. From supply chain management to voting systems, more industries are starting to explore how they can utilize blockchain technology. This could drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the beginning stages of development. As advancements continue to be made in areas like scalability and security, the potential of crypto assets will continue to expand. This could lead to more use and increase in prices.
Global economic uncertainty is growing
Due to the constant economic uncertainty brought on due to the COVID-19 pandemic, as well as other causes, more and more investors are starting to look for safe haven investments like bitcoin and even gold. As the global economic situation remains uncertain and uncertain, this could lead to more demand for crypto as well as increased prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in one who’s showing an interest in crypto. Retail investors, or individual investors, are also starting to get involved in the market for crypto. With increasing numbers of people learn about crypto and the best ways to invest in it This could result in more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto continues to mature as more and more people are beginning to become aware about and appreciate it. As the awareness and acceptance grows of crypto, this could lead to more people purchasing as well as holding the crypto that can increase prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market that enables finance services created on top of blockchain technology. As DeFi continues to grow and more platforms and projects come online, this could lead to increased adoption and increased prices for crypto.
Advances in crypto-based payment methods
As the market for crypto is growing as more and more businesses are starting using crypto to be a method of payment. This could lead to an increase in the use of crypto in regular transactions and higher prices.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are government-owned investments, are beginning to look at cryptocurrency as a possible asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, it could result in a rise in demand and increased prices.
Utilization of crypto to make payment across borders
One of the major benefits of cryptocurrency is its ability to make fast and cheap cross-border payments. As more businesses and individuals are beginning to make use of cryptocurrency for international transactions it could result in increased demand and higher costs.
Increasing numbers of crypto ATM’s
The number of crypto ATM’s increase it will be easier for people to buy and hold cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, or digital assets that signify ownership of an asset, such as real estate or stock is a fast-growing segment of the cryptocurrency market. As more security tokens are created and traded, it can lead to a higher demand and consequently higher prices for crypto.
A greater adoption rate by merchants
With the increasing number of retailers begin accepting crypto as a form of payment, it will make it easier for customers to utilize and store crypto, which can drive up demand and prices.
So, is crypto likely to grow in 2023? The only way to know is time. But with these factors in mind, it’s likely that the crypto market could be able to see a rebound in 2023. If you’re committed to the long haul patience and discipline will be key.