It’s been a difficult experience for the crypto market through 2022. In November, the market had dipped by more than 70% from its previous peak on November 20, 2021. Just when the market was looking down after the FTX crash turned them worse. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had many dips over the years. Each time, it’s rebounded with a big rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year before hitting a low of $150. However, in 2017 it broke that record and reached a new highest of $19,600. Fast forward to 2018, the price was at $3,100. And in 2020, it broke that resistance and hit a new high of $68,000 in November 2021. And just like that, we’ve seen another dip. But history shows us that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
As we’ve seen in the past, dips tend to be followed by a prolonged bull run that eventually overcomes the resistance set by the market’s previous highest price. This is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has made significant progress in recent years. With more and more businesses and industries embracing the technology, its use and acceptance is increasing. From gaming to finance the use of crypto is increasing in a myriad of ways. This growing demand can lead to increasing participation in the market and, in turn, drive the prices up.
The rise in interest of institutions in cryptocurrency
In recent years we’ve witnessed a rising interest from institutional investors in cryptocurrency. From hedge funds to banks, many large institutions are beginning to investigate the possibilities for crypto-based assets. The increased interest of institutions could bring more stability to the crypto market and could lead to more expensive prices.
Regulations of the government
As the market for crypto grows as it matures, governments all over 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 underlies many cryptocurrencies, blockchain, offers a variety of potential use cases that go beyond financial transactions. From supply chain management to voting systems, more and more industries are exploring ways they can make use of blockchain technology. This could increase investment and enthusiasm in cryptocurrency.
Blockchain technology and cryptography are still in the beginning stages of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will continue to expand. This could lead to greater adoption and higher prices.
Uncertainty in the global economy
With the ongoing economic uncertainty brought on due to the COVID-19 pandemic as well as other factors increasing numbers of investors are beginning to look for safe haven assets such as bitcoin and even gold. As the global economic situation is uncertain and uncertain, this could lead to more demand for crypto as well as higher prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only ones showing interest in cryptocurrency. Retail investors, also known as individual investors are also beginning to get involved in the crypto market. In the future, as more people are educated about cryptocurrency and investing in it, this could lead to an increase in demand and consequently higher prices.
The growing awareness and acceptance of crypto
As the market for crypto grows as more and more people are beginning to learn about it and comprehend the concept. As awareness and acceptance of crypto grows, it will lead to increasing numbers of people purchasing as well as holding the crypto that can raise prices.
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The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market that allows financial services to be developed using blockchain technology. As DeFi continues to grow and more projects and platforms become available, this could result in increased use and more expensive prices for crypto.
Developments in crypto payment methods
As the market for crypto continues to grow increasing numbers of companies are beginning using crypto to be a means of payment. This could lead to an increase in the use of crypto in everyday transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
These funds are owned by the state as instruments for investing, are beginning to show interest in crypto as an asset class. As more funds allocate a portion of their portfolio to crypto, this could result in a rise in demand and increased prices.
Utilization of crypto to make international payments
One of the major benefits 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 crypto for international transactions, it could result in increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
As the number of crypto ATM’s continue to increase, it will become easier for people to buy and keep crypto, which will boost demand and increase prices.
The development of security tokens
Security tokens, also known as digital assets that are used to represent ownership of an asset, such as stocks or real estate are rapidly expanding sector of the crypto market. Since more and more security tokens will be issued and traded, it can lead to a higher demand, and thus 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 makes it easier for customers to hold and use cryptocurrency, which will boost demand and increase prices.
Will crypto be on the increase in 2023? It’s only time to find out. With these things being considered, it’s possible that the crypto market will have a rebound by 2023. For those looking to invest for the long run Being patient and disciplined will be key.