It’s been a difficult experience for the crypto market until 2022. In November the market had dropped by 70 percent from its previous high at the end of November. When things were looking down after the FTX crash made them look more dire. What is the likelihood that the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced its fair share of dips over the years. And every time, it’s bounced back with a huge rally.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for more than a year before reaching a bottom of $150. However, in 2017, it broke the record and hit a record highest of $19,600. Then, in 2018, and it was trading at $3,100. In 2020, it broke that resistance, and reached a record high of $68,000 in November 2021. And just like that, we’ve witnessed another drop. However, the past has proven that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
As we’ve seen in the past, dips are usually followed by a prolonged bull run that eventually surpasses the resistance created by the previous high price. This pattern can be seen not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in the last few years. With more and more companies and industries taking to the technology, its use and acceptance is growing. From gaming to finance the use of crypto is increasing in many ways. And this growing use case could result in more people getting involved in the crypto market and, in turn, boost prices.
A rise in the interest of institutions for crypto
In the last few years we’ve noticed a growing curiosity from institutions investing in crypto. From banks to hedge funds and even large corporations are beginning to investigate the possibilities of crypto assets. The increasing interest from institutions could bring more stability to the market for crypto and result in higher prices.
Government regulations
As the market for crypto continues to mature as it matures, governments all over the world are beginning to establish more favorable regulations for cryptocurrency. This could help attract more investors and increase the mainstream adoption of crypto.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrencies, blockchain, has a wide range of possible applications beyond the realm of financial transactions. For example, from supply chain management and voting, many companies are exploring ways they can utilize blockchain technology, which could stimulate more investment and excitement in crypto.
Advancements in technology
Blockchain and cryptocurrency technology is at the very beginning of development. As progress is made in areas such as security and scalability, the potential of cryptocurrency assets will continue to increase. This could lead to greater use and increase in prices.
Rising global economic uncertainty
With the ongoing economic uncertainty brought on due to the COVID-19 pandemic as well as other factors increasing numbers of investors are starting to look for safe haven assets like gold and crypto. As the global economic situation is uncertain it could result in increased demand for crypto and increased prices.
Retail investors are able to earn interest
Institutional investors aren’t the only people who are interested in crypto. Retail investors, or even individual investors, are also starting to invest in the crypto market. In the future, as more people become aware of cryptocurrency and investing in it, this could lead to more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market continues to mature as more and more people are beginning to learn about it and comprehend the concept. As awareness and acceptance grows of crypto, this could lead to more people buying and holding crypto, which could increase prices.
betdex crypto
Decentralized finance (DeFi) is an emerging area of the crypto market, which allows financial services to be built on top of blockchain technology. As DeFi expands and more platforms and projects come online, this could result in increased use and increased prices for crypto.
Advances in crypto-based payment methods
As the crypto market continues to grow increasing numbers of companies are beginning accepting crypto payments as a means of payment. This could lead to increased use of crypto in everyday transactions and higher prices.
The increased investment of sovereign wealth funds
These funds are owned by the state as instruments for investing, are beginning to show interest in crypto as an asset class. As more of these funds devote a percentage of their portfolio to crypto, it could lead to increased demand and more expensive prices.
Use of crypto for cross-border payments
One of the biggest benefits of crypto is its ability to facilitate swift and affordable cross-border transactions. As more businesses and individuals begin to use cryptocurrency for international transactions, this can lead to a rise in the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
The number of ATMs for crypto increase it will be easier for consumers to purchase and store crypto, which will drive up demand and prices.
The development of security tokens
Security tokens, or digital assets that are used to represent ownership in an asset like stocks or real estate, are a rapidly growing sector of the crypto market. With the increasing number of security tokens being created and traded, it could lead to increased demand and higher prices for crypto.
Merchants are more likely to adopt the concept.
In the event that more businesses accept crypto as a means of payment, it will make it more convenient for people to use and hold crypto, which can drive up demand and prices.
So, is crypto likely to rise in 2023? Only time will tell. However, with these aspects to consider, it’s likely that the crypto market will be able to see a rebound in 2023. And for those who are in it for the long haul Being patient and disciplined is essential.