It’s been a difficult journey for the cryptocurrency market until 2022. In November, the market had dipped by more than 70% from its previous peak in November 2021. Just when the market was going downhill and down, the FTX crash made them look even more dire. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had many drops in the past. Each time, it’s bounced back with a huge rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for over a year before hitting a low of $150. In 2017, it broke that record and reached a new high of $19,600. In 2018, the price was at $3,100. In 2020, the price broke through that resistance and hit a new high of $68,000 in November 2021. And just like that, we’ve seen another dip. But history shows us that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen previously, dips are typically followed by a lengthy bull run, which eventually surpasses the resistance created by the previous high price. This is evident in more than Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in recent years. With more and better companies and industries embracing it, its usage and acceptance is increasing. From banking to gaming, crypto is being used in many ways. And this growing use case could result in more people being involved in the market, which in turn could increase the price.
Increased institutional interest in crypto
In the last few years, we’ve seen a growing interest from institutional investors in cryptocurrency. From banks to hedge funds numerous large institutions are starting to explore the potential for crypto-based assets. This increased interest from institutions could bring more stability to the crypto market and could lead to more expensive prices.
As the crypto market is maturing, governments around the world are beginning to develop more favorable regulations for cryptocurrency. This could help attract more investors as well as increase the acceptance of crypto in general.
More use cases for blockchain
The underlying technology behind the majority of cryptocurrencies, blockchain is a broad range of applications that go beyond just financial transactions. In addition to supply chain management, voting and other systems and more industries are beginning to look at ways they can utilize blockchain technology. This could increase investment and enthusiasm in crypto.
Advancements in technology
Blockchain technology and cryptography are still in the beginning stages of development. As progress is made in areas like scalability and security, the potential of cryptocurrency assets will continue to increase. This could lead to greater use and increase in prices.
Uncertainty in the global economy
In the current economic uncertainty caused due to the COVID-19 pandemic, as well as other causes many investors are looking for safe haven investments like gold and crypto. Since the economic outlook for the world remains uncertain and uncertain, this could lead to increased demand for crypto and more expensive prices.
Retail investors are able to earn interest
Institutional investors aren’t the only one who’s showing an interest in crypto. Retail investors, or even individual investors, are also starting to participate in the market for crypto. As more and more people are educated about crypto and how to invest in it this could result in increased demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto is maturing increasing numbers of people are beginning to become aware about it and comprehend the concept. As understanding and acceptance grows of crypto, this could lead to more people buying as well as holding the crypto that could drive up prices.
best moving average for crypto
Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market that enables finance services created upon blockchain technology. As DeFi expands and more projects and platforms come online, this could lead to increased adoption and more expensive prices for crypto.
Developments in crypto payment methods
As the crypto market continues to grow as more and more businesses are starting using crypto to be a method of payment. This could result in increased usage of crypto in daily transactions and higher prices.
The increased investment of sovereign wealth funds
These funds are state-owned instruments for investing, are beginning to look at crypto as an asset class. As more of these funds dedicate a part of their portfolio to crypto, this could result in a rise in demand and more expensive prices.
Utilization of crypto to make cross-border payments
One of the main advantages of crypto is its capability to perform swift and affordable cross-border transactions. As more individuals and businesses start to utilize cryptocurrency for international transactions, this can lead to a rise in the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
With the amount of ATMs for crypto continue to increase, it will become easier for consumers to purchase and keep cryptocurrency, which can increase demand and price.
Development of security tokens
Security tokens, which are digital assets that represent ownership of an asset, such as stock or real estate, are a rapidly 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.
A greater adoption rate by merchants
With the increasing number of businesses accept cryptocurrency as a method of payment, it will make it easier for people to use and hold crypto, which could increase demand and price.
Will crypto be on the rise in 2023? It’s only time to find out. However, with these aspects being considered, it’s likely that the cryptocurrency market will see a recovery in 2023. If you’re committed to the long-term patience and discipline will be key.