It’s been a rough journey for the cryptocurrency market in 2022. By November the market was down by more than 70 percent from the previous high on November 20, 2021. And just when things were going downhill and down, the FTX crash made them look worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen many drops in the past. Every time, it has bounced back with a big increase.
For instance, in 2013, Bitcoin reached a peak of $1,160, then fell for a full year before reaching a bottom of $150. But, in 2017 it broke that record and hit a record high of $19,600. Then, in 2018, and it was trading at $3,100. And in 2020, it broke through the resistance, and reached a record highest of $68,000 in November 2021. Just like that, we’ve seen another dip. However, the past has proven 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 that finally overcomes the resistance set by the previous high price. This pattern can be seen in more than Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in recent years. With more and more companies and industries adopting it, its usage and acceptance is growing. From finance to gaming, crypto is being used in a variety of ways. And this growing use case can lead to more people being involved in the market and, in turn, boost prices.
The rise in interest of institutions in crypto
In recent years, we’ve seen a growing curiosity from institutions investing in crypto. From banks to hedge funds and even large corporations are now exploring the potential of crypto assets. The increasing interest from institutions can bring stability to the market for crypto and result in higher prices.
Regulations from the Government
As the market for crypto is maturing as it matures, governments all over the world are beginning to establish more favorable regulations for crypto. This is likely to attract more investors and increase the adoption rate of crypto.
Blockchain has many more applications.
The technology that is the basis of the majority of cryptocurrencies, blockchain has a wide range of potential use cases beyond the realm of financial transactions. For example, from supply chain management and voting, many and more industries are starting to explore how they can make use of blockchain technology. This could increase investment and enthusiasm in cryptocurrency.
Technologies are constantly evolving.
Crypto and blockchain technology are still in the early stages of development. As progress is made in areas such as scalability and security, the potential of crypto assets will continue to grow. This could result in more adoption and higher prices.
Global economic uncertainty is growing
In the current instability in the economy caused due to the COVID-19 pandemic and other factors increasing numbers of investors are looking for safe haven assets such as bitcoin and even gold. As the global economic situation remains uncertain, this could lead to more demand for crypto as well as increased prices.
Interest from retail investors
Investors from institutions aren’t the only people who are interested in cryptocurrency. Retail investors, or individual investors are also beginning to invest in the crypto market. In the future, as more people learn about crypto and the best ways to invest in it, this could lead to an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the market for crypto is maturing as more and more people are starting to learn about it and comprehend the concept. As the awareness and acceptance grows of crypto it could result in more people purchasing as well as holding the crypto that could raise prices.
btce crypto
Financial decentralization (DeFi) is an emerging area of the crypto market that enables financial services to be built on top of blockchain technology. As DeFi expands and more platforms and projects are launched, it could lead to increased adoption and increased prices for crypto.
The development of crypto payment methods
As the market for crypto is growing, more and more companies are beginning to accept crypto as a means of payment. This could lead to an increase in the usage of crypto in daily transactions, and a rise in prices.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned investment vehicles, are now beginning to show interest in crypto as a potential asset class. As more of these funds devote a percentage or their entire portfolios to cryptocurrency, this could result in a rise in demand and higher prices.
Cryptocurrency is used for international payments
One of the main advantages of crypto is its ability to facilitate quick and inexpensive cross-border payments. As more and more people and businesses are beginning to make use of crypto for international transactions, this can lead to a rise in demand and higher costs.
The number of ATMs that accept crypto is increasing.
With the amount of ATMs for crypto continue to grow, it will become easier for consumers to purchase and keep crypto, which could boost demand and increase prices.
The development of security tokens
Security tokens, also known as digital assets that represent ownership of an asset, like real estate or stock is a fast-growing area of the crypto market. With the increasing number of security tokens being created and traded, it could result in a rise in demand and higher rates for the crypto.
Merchants are more likely to adopt the concept.
In the event that more businesses start accepting crypto as a means of payment, it will make it easier for consumers to utilize and store cryptocurrency, which will drive up demand and prices.
So, is crypto likely to increase in 2023? Only time will tell. But with these factors in mind, it’s possible that the cryptocurrency market will have a rebound by 2023. If you’re committed to the long haul patience and discipline is crucial.