It’s been a rough ride for the crypto market in 2022. In November, the market had dipped by more than 70 percent from the previous high on November 20, 2021. And just when things were going downhill after the FTX crash turned them more dire. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen many dips over the years. And every time, it has bounced back with a huge rally.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for over a 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, the price was at $3,100. In 2020, the price broke that resistance and reached a new high of $68,000 in November 2021. Just like that, we’ve witnessed another drop. 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 in the past, dips tend to be followed by a prolonged bull run that eventually surpasses the resistance created by the previous high price. This pattern can be seen in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in recent years. With more and more businesses and industries embracing the technology, its use and acceptance is rising. From banking to gaming, crypto is being used in a myriad of ways. The growing popularity of crypto could result in increasing participation in the crypto market which could increase the price.
The rise in interest of institutions in cryptocurrency
In recent times we’ve noticed a growing interest from institutional investors in cryptocurrency. From hedge funds to banks, many large institutions are starting to explore the possibilities of crypto assets. The increasing interest from institutions could provide more stability to the crypto market and result in greater prices.
Regulations from the Government
As the crypto market is maturing and mature, governments across the globe are starting to create more favorable rules for crypto. This will help draw more investors and boost the mainstream adoption of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrencies, blockchain, is a broad range of applications that go beyond the realm of financial transactions. In addition to supply chain management, voting and other systems industries are beginning to look at ways they can make use of blockchain technology. This could stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Crypto and blockchain technology are at the very beginning of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will grow. This could result in more acceptance and higher prices.
Global economic uncertainty is growing
Due to the constant economic uncertainty brought on by the COVID-19 pandemic and other factors, more and more investors are looking for safe haven assets like cryptocurrency and gold. Since the economic outlook for the world remains uncertain it could result in increased demand for crypto and increased prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, also known as individual investors are also beginning to participate in the crypto market. As more and more everyday people learn about cryptocurrency and investing in it This could result in increased demand and higher prices.
The growing awareness and acceptance of crypto
As the crypto market grows increasing numbers of people are beginning to become aware about it and comprehend the concept. As understanding and acceptance of cryptocurrency grows it could result in more people purchasing as well as holding the crypto that could raise prices.
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The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market, which allows the provision of financial services created upon blockchain technology. As DeFi grows and more projects and platforms are launched, it could result in increased use and higher prices for crypto.
Advances in crypto-based payment methods
As the market for crypto is growing increasing numbers of companies are beginning accepting crypto payments as a form of payment. This could result in increased use of crypto in regular transactions and higher prices.
More investment from sovereign wealth funds
These funds are state-owned instruments for investing, are now beginning to show interest in cryptocurrency as a possible asset class. As more funds allocate a portion of their portfolio to crypto, it could lead to increased demand and increased prices.
Utilization of crypto to make cross-border payments
One of the major benefits of crypto is the capability to perform quick and inexpensive cross-border payments. As more individuals and businesses start to utilize 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
With the amount of crypto ATM’s continue to increase, it will become easier for people to buy and hold crypto, which could increase demand and price.
Development of security tokens
Security tokens, also known as digital assets that signify ownership of an asset, like stocks or real estate are rapidly expanding area of the crypto market. As more security tokens are created and traded, it could result in a rise in demand and consequently higher rates for the crypto.
A greater adoption rate by merchants
With the increasing number of retailers start accepting crypto as a means of payment, this will make it more convenient for people to hold and use crypto, which can increase demand and price.
Will crypto be on the grow in 2023? It’s only time to find out. However, with these aspects to consider, it’s possible that the crypto market could be able to see a rebound in 2023. If you’re in it for the long run Being patient and disciplined is crucial.