It’s been a rough journey for the cryptocurrency market until 2022. As of November, the market had dipped by 70 percent from the previous high in November 2021. When things were going downhill, the FTX crash turned things worse. The question is, can 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 huge increase.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for a full year before reaching a bottom of $150. In 2017 it broke that record, and hit a new highest of $19,600. Then, in 2018, and it was trading at $3,100. And in the year 2020 it struck through the resistance, and reached a record high of $68,000 in November 2021. Just like that, we’ve seen another dip. However, history has shown us that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs are typically followed by a prolonged bull run, which eventually surpasses the resistance created by the market’s previous highest price. This pattern is evident in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in recent years. With more and more businesses and industries taking to it, its usage and acceptance is increasing. From finance to gaming, crypto is being used in a variety of ways. And this growing use case could result in more people being involved in the crypto market which could boost prices.
A rise in the interest of institutions for crypto
In the last few years we’ve noticed a growing interest from institutional investors in crypto. From banks to hedge funds and even large corporations are now exploring the potential of crypto assets. This increased interest from institutions can bring stability to the market for crypto and lead to more expensive prices.
Regulations of the government
As the market for crypto grows, governments around the world are beginning to establish more favorable rules for cryptocurrency. This will help draw more investors and increase the mainstream adoption of crypto.
A broader range of blockchain applications
The underlying technology behind many cryptocurrency, blockchain, offers a variety of applications that go beyond just financial transactions. In addition to supply chain management, voting and other systems companies are beginning to look at ways they can utilize blockchain technology. This will drive more investment and interest in crypto.
Advancements in technology
Crypto and blockchain technology are still in the early stages of development. As advancements continue to be made in areas like scalability and security, the potential of cryptocurrency assets will continue to grow. This could lead to more acceptance and higher prices.
Global economic uncertainty is growing
In the current economic uncertainty caused through 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. Because the global economic climate is uncertain, this could lead to more demand for crypto as well as higher prices.
Retail investors are able to earn interest
Institutional investors aren’t the only people who are interested in crypto. Retail investors, also known as individual investors are also beginning to invest in the market for crypto. As more and more people are educated about crypto and the best ways to invest in it This could result in more demand and higher prices.
Growing awareness and acceptance of crypto
As the crypto market is maturing, more and more people are beginning to learn about and appreciate it. As awareness and acceptance grows of crypto, this could lead to increasing numbers of people purchasing or holding cryptocurrency, and this can increase prices.
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The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market, which allows the provision of financial services developed upon blockchain technology. As DeFi expands and more projects and platforms are launched, it will lead to a rise in adoption and more expensive prices for crypto.
The development of crypto payment methods
As the crypto market grows, more and more companies are starting accepting crypto payments as a means of payment. This could result in increased use of crypto in regular transactions, and a rise in prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as state-owned investment vehicles, are starting to look at cryptocurrency as a possible asset class. As more of these funds dedicate a part of their assets to digital currencies, this could result in a rise in demand and higher prices.
Utilization of crypto to make payment across borders
One of the main advantages of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more and more people and businesses are beginning to make use of cryptocurrency for international transactions it could result in increased the demand for it and a rise in prices.
An increasing number of crypto ATM’s
As the number of crypto ATM’s continue to increase it will be more convenient for individuals to purchase and hold crypto, which will drive up demand and prices.
Development of security tokens
Security tokens, or digital assets that represent ownership in an asset like real estate or stock is a fast-growing area 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.
More adoption by merchants
With the increasing number of businesses begin accepting crypto as a form of payment, this will make it more convenient for customers to utilize and store cryptocurrency, which will boost demand and increase prices.
So, is crypto likely to rise in 2023? It’s only time to find out. However, with these aspects being considered, it’s likely that the crypto market will have a rebound by 2023. And for those who are committed to the long-term Being patient and disciplined will be key.