It’s been a difficult ride for the crypto market through 2022. By November, the market had dipped by more than 70 percent from its previous high at the end of November. Just when the market was getting worse, the FTX crash turned things more dire. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has had its fair share of dips over the years. And every time, it’s bounced back with a big rise.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for a full year before hitting a low of $150. However, in 2017, it broke the record and hit a record high of $19,600. Fast forward to 2018, and it was trading at $3,100. In 2020, it broke that resistance and hit a new peak of $68,000 in the month of November 2021. 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
Similar to what we’ve witnessed before, fall-offs tend to be followed by a prolonged bull run that finally overcomes the resistance set by the previous high price. This is evident not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in the last few years. With more and more businesses and industries adopting it, its usage and acceptance is rising. From banking to gaming the use of crypto is increasing in a myriad of ways. And this growing use case could result in more people getting involved in the market which could boost prices.
Increased institutional interest in cryptocurrency
In recent years, we’ve seen a growing curiosity from institutions investing in crypto. From hedge funds to banks, many large institutions are beginning to investigate the possibilities of crypto assets. The increased interest of institutions could bring more stability to the market for crypto and result in greater prices.
As the crypto market continues to mature, governments around the world are beginning to establish more favorable regulations for crypto. This could help attract more investors and boost the acceptance of crypto in general.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrency, blockchain, is a broad range of possible applications beyond the realm of financial transactions. From supply chain management to voting systems, more industries are exploring ways they can utilize 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 progress is made in areas such as security and scalability, the potential of cryptocurrency assets will continue to increase. This could lead to greater acceptance and higher prices.
Uncertainty in the global economy
With the ongoing instability in the economy caused by the COVID-19 pandemic and other factors increasing numbers of investors are starting to look for safe haven assets such as gold and crypto. As the global economic situation remains uncertain and uncertain, this could lead to increased demand for crypto and more expensive prices.
Interest from retail investors
Investors from institutions aren’t the only one who’s showing an interest in crypto. Retail investors, or even individual investors are also beginning to get involved in the market for crypto. With increasing numbers of people are educated about crypto and the best ways to invest in it This could result in increased demand and higher prices.
The growing awareness and acceptance of crypto
As the crypto market continues to mature increasing numbers of people are starting to learn about and understand the concept. As the awareness and acceptance grows of crypto it could result in more people purchasing and holding crypto, which can increase prices.
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The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market, which allows the provision of financial services developed upon 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.
The development of crypto payment methods
As the market for crypto is growing as more and more businesses are beginning to accept crypto as a method of payment. This could result in increased use of crypto in everyday transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are government-owned investments, are beginning to look at crypto as an 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 increased prices.
Utilization of crypto to make international payments
One of the biggest benefits of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more individuals and businesses begin to use crypto for international transactions, this could lead to increased demand and higher costs.
Increasing numbers of crypto ATM’s
The number of crypto ATM’s continue to increase it will be easier for individuals to purchase and keep crypto, which will drive up demand and prices.
Development of security tokens
Security tokens, also known as digital assets that are used to represent ownership in an asset such as stocks or real estate are rapidly expanding area of the crypto market. As more security tokens are created and traded, this could result in a rise in demand and higher costs for cryptocurrency.
Merchants are more likely to adopt the concept.
As more and more retailers start accepting crypto as a form of payment, it will make it more convenient for customers to use and hold cryptocurrency, which will increase demand and price.
So, is crypto likely to rise in 2023? It’s only time to find out. But with these factors being considered, it’s possible that the cryptocurrency market will have a rebound by 2023. If you’re in it for the long-term Being patient and disciplined will be key.