It’s been a difficult experience for the crypto market until 2022. In November the market had dropped by 70% from its previous peak in November 2021. And just when things were looking down, the FTX crash turned things worse. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had its fair share of dips over the years. And every time, it’s bounced back by a massive increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for over a year, reaching a low of $150. In 2017, it broke that record and reached a new highest of $19,600. In 2018, and it was trading at $3,100. In the year 2020 it struck through the resistance, and reached a record peak of $68,000 in the month of November 2021. Just like that, we’ve witnessed another drop. But history shows us that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen previously, dips tend to be followed by a long bull run that eventually surpasses the resistance created by the market’s previous highest price. This pattern is evident in more than Bitcoin but also other cryptocurrencies.
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 embracing the technology, its use and acceptance is growing. From banking to gaming, crypto is being used in a myriad of ways. This growing demand could lead to increasing participation in the market, which in turn could boost prices.
Increased institutional interest in crypto
In the last few years we’ve witnessed a rising demand from investors of institutional scale in cryptocurrency. From banks to hedge funds numerous large institutions are starting to explore the potential for crypto-based assets. The increased interest of institutions could bring more stability to the crypto market and lead to more expensive prices.
Regulations of the government
As the crypto market is maturing, governments around the world are beginning to develop more favorable regulations for crypto. This will help draw more investors and increase the adoption rate of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrencies, blockchain, is a broad range of potential use cases that go beyond financial transactions. From supply chain management to voting systems, more industries are starting to explore how they can make use of blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas like security and scalability, potential of crypto assets will increase. This could lead to more use and increase in prices.
Rising global economic uncertainty
Due to the constant economic uncertainty brought on by the COVID-19 pandemic and other factors many investors are starting to look for safe haven assets like cryptocurrency and gold. Because the global economic climate remains uncertain and uncertain, this could lead to increased demand for crypto and increased prices.
Interest from retail investors
Institutional investors aren’t the only ones showing interest in cryptocurrency. Retail investors, or even individual investors, are also starting to get involved in the crypto market. In the future, as more everyday people become aware of crypto and how to invest in it, this could lead to more demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the crypto market continues to mature as more and more people are starting to learn about and appreciate the concept. As awareness and acceptance of cryptocurrency grows, it will lead to more people buying or holding cryptocurrency, and this could drive up prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market that enables the provision of financial services created upon blockchain technology. As DeFi expands and more projects and platforms become available, this could result in increased use and increased prices for crypto.
The development of crypto payment methods
As the market for crypto is growing as more and more businesses are starting accepting crypto payments as a means of payment. This could result in increased usage of crypto in daily transactions, and a rise in prices.
The increased investment of sovereign wealth funds
These funds are government-owned instruments for investing, are starting to look at crypto as a potential asset class. As more of these funds allocate a portion of their portfolio to crypto, this could lead to increased demand and higher prices.
Use of crypto for international payments
One of the biggest benefits of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more individuals and businesses begin to use cryptocurrency for international transactions, this could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
As the number of crypto ATM’s continue to grow 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 signify ownership of an asset, like stock or real estate are rapidly expanding area of the crypto market. As more security tokens are issued and traded, it could lead to increased demand and higher prices for crypto.
Merchants are more likely to adopt the concept.
As more and more retailers start accepting crypto as a form of payment, this makes it easier for customers to use and hold crypto, which can drive up demand and prices.
Will crypto be on the rise in 2023? The only way to know is time. With these things to consider, it’s likely that the cryptocurrency market will have a rebound by 2023. If you’re looking to invest for the long-term Being patient and disciplined is essential.