It’s been a tough ride for the crypto market until 2022. By November the market had dropped by more than 70 percent from the previous high on November 20, 2021. When things were getting worse, the FTX crash turned them even worse. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many drops in the past. And every time, it’s bounced back with a huge rally.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for more than a year before reaching a bottom of $150. In 2017 it broke that record and hit a record record high of $19,600. Fast forward to 2018, it was trading at $3,100. In the year 2020 it struck through that resistance and reached a new peak of $68,000 in the month of November 2021. Just like that, we’ve had another dip. However, the past has proven that at the end of every dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
As we’ve seen before, fall-offs tend to be followed by a lengthy bull run that finally breaks through the resistance created by the previous high price. This pattern can be seen in more than Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have progressed a lot in the last few years. With more and better companies and industries taking to the technology, its use and acceptance is increasing. 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 increase the price.
A rise in the interest of institutions for crypto
In the last few years, we’ve seen a growing demand from investors of institutional scale in cryptocurrency. From hedge funds to banks numerous large institutions are beginning to investigate the potential of crypto assets. The increasing interest from institutions can bring stability to the market for crypto and result in more expensive prices.
Regulations of the government
As the market for crypto is maturing, governments around the world are starting to create more favorable regulations for cryptocurrency. This is likely to attract more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The technology that is the basis of the majority of cryptocurrencies, blockchain has a wide range of applications that go that go beyond financial transactions. From supply chain management to voting systems, more and more industries are exploring ways they can benefit from blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Blockchain technology and cryptography are at the very beginning of development. As advancements continue to be made in areas like security and scalability, the potential of cryptocurrency assets will continue to grow. This could lead to more acceptance and higher prices.
Rising global economic uncertainty
With the ongoing economic uncertainty caused due to the COVID-19 pandemic and other factors many investors are beginning to look for safe haven assets such as bitcoin and even gold. Because the global economic climate remains uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Interest from retail investors
Investors from institutions aren’t the only one who’s showing an interest in crypto. Retail investors, or individual investors are also beginning to get involved in the crypto market. As more and more everyday people learn about crypto and the best ways to invest in it This could result in increased demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the crypto market grows increasing numbers of people are starting to learn about and appreciate the concept. As awareness and acceptance grows of crypto, this could lead to more people purchasing as well as holding the crypto that can raise prices.
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The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market that allows finance services created upon blockchain technology. As DeFi continues to grow and more platforms and projects come online, this will lead to a rise in adoption and increased prices for crypto.
Advances in crypto-based payment methods
As the market for crypto grows increasing numbers of companies are starting to accept crypto as a method of payment. This could result in increased use of crypto in everyday transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are government-owned investment vehicles, are now beginning to look at crypto as a potential asset class. As more of these funds allocate a portion or their entire portfolios to cryptocurrency, this could result in a rise in demand and more expensive prices.
Use of crypto for payment across borders
One of the main advantages of crypto is the ability to facilitate quick and inexpensive cross-border payments. As more businesses and individuals start to utilize cryptocurrency for international transactions, this could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of ATMs for crypto continue to grow it will be more convenient for individuals to purchase and store crypto, which will increase demand and price.
The development of security tokens
Security tokens, which are digital assets that represent ownership of an asset, like stocks or real estate are rapidly expanding 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 costs for cryptocurrency.
More adoption by merchants
With the increasing number of businesses begin accepting crypto as a means of payment, it makes it easier for consumers to hold and use crypto, which could boost demand and increase prices.
Will crypto be on the rise in 2023? It’s only time to find out. But with these factors being considered, it’s possible that the crypto market will have a rebound by 2023. If you’re committed to the long run, being patient and disciplined is crucial.