It’s been a rough journey for the cryptocurrency market until 2022. As of November the market had dropped by more than 70 percent from the previous high at the end of November. And just when things were looking down and down, the FTX crash turned things 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 in the past. And every time, it’s rebounded by a massive increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for over a year before reaching a bottom of $150. In 2017, it broke the record and hit a record highest of $19,600. Then, in 2018, the price was at $3,100. In the year 2020 it struck that resistance and hit a new peak of $68,000 in the month of November 2021. And just like that, we’ve seen another dip. However, the past has proven that at the end of every 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 lengthy bull run that finally overcomes the resistance set by the previous market’s highest price. This pattern can be seen not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has made significant progress in recent years. With more and more businesses and industries taking to it, its usage and acceptance is rising. From finance to gaming cryptocurrency is being utilized in a myriad of ways. This growing demand could lead to increasing participation in the crypto market, which in turn could increase the price.
Increased institutional interest in crypto
In recent years we’ve noticed a growing demand from investors of institutional scale in crypto. From hedge funds to banks, many large institutions are now exploring the potential in crypto currencies. The increasing interest from institutions could provide more stability to the crypto market and result in higher prices.
As the market for crypto is maturing, governments around the world are starting to create more favorable regulations for cryptocurrency. This will help draw more investors and increase the adoption rate of crypto.
Blockchain has many more applications.
The technology that underlies many cryptocurrency, blockchain, has a wide range of potential use cases beyond just financial transactions. From supply chain management to voting systems, more companies are exploring ways they can make use of blockchain technology. This could drive more investment and interest in cryptocurrency.
Advancements in technology
Blockchain technology and cryptography are at the very beginning of development. As advances continue to be made in areas like security and scalability, the potential of crypto assets will increase. This could result in more acceptance and higher prices.
Uncertainty in the global economy
In the current economic uncertainty caused through the COVID-19 pandemic as well as other factors many investors are looking for safe haven assets such as gold and crypto. Since the economic outlook for the world remains uncertain and uncertain, this could lead to more demand for crypto as well as higher prices.
Interest from retail investors
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 market for crypto. With increasing numbers of people become aware of crypto and how to invest in it this could result in more demand and higher prices.
The 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 it and comprehend the concept. As the awareness and acceptance grows of crypto, it will lead to more people purchasing or holding cryptocurrency, and this can increase prices.
bot ocean crypto
Decentralized finance (DeFi) is an emerging area of the crypto market that enables financial services to be built on top of blockchain technology. As DeFi continues to grow and more platforms and projects become available, this could result in increased use and more expensive prices for crypto.
Developments in crypto payment methods
As the market for crypto is growing, more and more companies are beginning using crypto to be a means of payment. This could result in increased use of crypto in regular transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as state-owned investment vehicles, are beginning to look at crypto as a potential asset class. As more funds allocate a portion or their entire portfolios to cryptocurrency, it could lead to increased demand and more expensive prices.
Use of crypto for international payments
One of the main advantages of cryptocurrency is its ability to facilitate swift and affordable cross-border transactions. As more individuals and businesses begin to use crypto for international transactions, this could lead to increased the demand for it and a rise in prices.
An increasing number of crypto ATM’s
The number of ATMs that accept crypto continue to grow it will be more convenient for individuals to purchase and hold crypto, which could increase demand and price.
Security tokens are developed for development
Security tokens, or digital assets that represent ownership of an asset, such as real estate or stock is a fast-growing sector of the crypto market. Since more and more security tokens will be issued and traded, it could result in a rise in demand and higher prices for crypto.
Merchants are more likely to adopt the concept.
With the increasing number of businesses start accepting crypto as a form of payment, this will make it more convenient 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 possible that the cryptocurrency market will be able to see a rebound in 2023. If you’re in it for the long haul patience and discipline is crucial.