It’s been a tough journey for the cryptocurrency market through 2022. As of November, the market had dipped by more than 70% from its previous peak at the end of November. And just when things were looking down, the FTX crash turned them more dire. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen many dips in the past. Every time, it’s bounced back with a huge rally.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for more than a year before hitting a low of $150. In 2017, it broke that record and hit a record record high of $19,600. In 2018, and it was trading at $3,100. In 2020, it broke through the resistance, and reached a record highest of $68,000 in November 2021. And just like that, we’ve had another dip. But history shows us that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
As we’ve seen previously, dips tend to be followed by a prolonged bull run that finally breaks through the resistance created by the previous market’s highest price. This is evident in more than Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in the last few years. With more and better companies and industries taking to the technology, its use and acceptance is growing. From finance to gaming the use of crypto is increasing in a myriad of ways. And this growing use case can lead to more people being involved in the crypto market and, in turn, drive the prices up.
A rise in the interest of institutions for crypto
In recent times we’ve noticed a growing interest from institutional investors in cryptocurrency. From hedge funds to banks, many large institutions are beginning to investigate the potential of crypto assets. The increasing interest from institutions could bring more stability to the crypto market and result in higher prices.
Regulations of the government
As the market for crypto is maturing as it matures, governments all over the world are beginning to develop more favorable regulations for cryptocurrency. This will help draw more investors and increase the acceptance of crypto in general.
More use cases for blockchain
The technology that is the basis of many cryptocurrency, blockchain, has a wide range of potential use cases beyond just financial transactions. In addition to supply chain management, voting and other systems companies are exploring ways they can make use of blockchain technology, which could increase investment and enthusiasm in crypto.
Technology advancements
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas such as scalability and security, the potential of crypto assets will continue to expand. This could lead to greater acceptance and higher prices.
Rising global economic uncertainty
In the current instability in the economy caused through the COVID-19 pandemic, as well as other causes, more and more investors are beginning to look for safe haven assets like gold and crypto. Since the economic outlook for the world is uncertain and uncertain, this could lead to increased demand for crypto and more expensive prices.
Interest from retail investors
Institutional investors aren’t the only ones showing interest in cryptocurrency. Retail investors, or even individual investors are also beginning to participate in the market for crypto. In the future, as more people are educated about crypto and the best ways to invest in it this could result in more demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the market for crypto continues to mature as more and more people are beginning to become aware about it and comprehend it. As awareness and acceptance of cryptocurrency grows it could result in more people buying as well as holding the crypto that could increase prices.
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The Decentralized Finance (DeFi) is an emerging area of the crypto market, which allows finance services developed upon blockchain technology. As DeFi grows and more platforms and projects become available, this could lead to increased adoption and increased prices for crypto.
The development of crypto payment methods
As the crypto market grows, more and more companies are beginning accepting crypto payments as a means of payment. This could result in increased usage of crypto in daily transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are owned by the state as investments, are starting to explore crypto as a potential asset class. As more of these funds devote a percentage of their portfolio to crypto, it could result in a rise in demand and higher prices.
Cryptocurrency is used for international payments
One of the main advantages of cryptocurrency is its capability to perform quick and inexpensive cross-border payments. As more and more people and businesses are beginning to make use of cryptocurrency for international transactions, this could lead to increased the demand for it and a rise in prices.
An increasing number of crypto ATM’s
As the number of ATMs that accept crypto continue to grow it will be easier for consumers to purchase and hold cryptocurrency, which can boost demand and increase prices.
Development of security tokens
Security tokens, which are digital assets that represent ownership of an asset, like stock or real estate is a fast-growing segment of the cryptocurrency market. Since more and more security tokens will be created and traded, it can lead to a higher demand and higher costs for cryptocurrency.
A greater adoption rate by merchants
With the increasing number of businesses begin accepting crypto as a means of payment, this will make it more convenient for customers to utilize and store crypto, which could drive up demand and prices.
So, is crypto likely to increase in 2023? It’s only time to find out. With these things to consider, it’s likely that the cryptocurrency market will have a rebound by 2023. For those looking to invest for the long haul Being patient and disciplined is crucial.