It’s been a tough experience for the crypto market until 2022. As of November the market had dropped by more than 70% from its previous peak in November 2021. When things were getting worse after the FTX crash turned them even more dire. 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. Each time, it’s rebounded by a massive rise.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for a full year before reaching a bottom of $150. But, in 2017, it broke that record and reached a new highest of $19,600. Then, in 2018, the price was at $3,100. And in 2020, the price broke through that resistance, and reached a record highest of $68,000 in November 2021. Just like that, we’ve seen another dip. However, the past has proven that after each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs are typically followed by a lengthy bull run that eventually surpasses the resistance created by the previous high price. This pattern can be seen in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in the last few years. With more and more companies and industries embracing it, its usage and acceptance is increasing. From finance to gaming the use of crypto is increasing in many ways. The growing popularity of crypto could lead to more people being involved in the crypto market which could drive the prices up.
The rise in interest of institutions in crypto
In the last few years we’ve witnessed a rising interest from institutional investors in crypto. From hedge funds to banks and even large corporations are beginning to investigate the potential of crypto assets. The increasing interest from institutions can bring stability to the crypto market and result in higher prices.
Regulations from the Government
As the market for crypto grows, governments around the world are beginning to establish more favorable regulations for cryptocurrency. This could help attract more investors as well as increase the mainstream adoption of crypto.
Blockchain has many more applications.
The underlying technology behind many cryptocurrencies, blockchain, has a wide range of potential use cases beyond the realm of financial transactions. For example, from supply chain management and voting, many companies are exploring ways they can make use of 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 advances continue to be made in areas like scalability and security, the potential of cryptocurrency assets will continue to increase. This could result in more use and increase in prices.
Rising global economic uncertainty
In the current instability in the economy caused by the COVID-19 pandemic and other factors increasing numbers of investors are looking for safe haven assets like cryptocurrency and gold. Because the global economic climate remains uncertain and uncertain, this could lead to increased demand for crypto and more expensive prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in people who are interested in cryptocurrency. Retail investors, also known as individual investors, are also starting to invest in the cryptocurrency market. As more and more everyday people learn about crypto and the best ways to invest in it, this could lead to more demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto grows as more and more people are beginning to become aware about and understand it. As the awareness and acceptance of crypto grows, it will lead to more people purchasing or holding cryptocurrency, and this can raise prices.
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Financial decentralization (DeFi) is a rapidly growing area of the crypto market that enables financial services to be developed on top of blockchain technology. As DeFi grows and more projects and platforms become available, this will lead to a rise in adoption and more expensive prices for crypto.
Developments in crypto payment methods
As the market for crypto continues to grow increasing numbers of companies are starting using crypto to be a form of payment. This could lead to increased use of crypto in regular transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
These funds are government-owned investment vehicles, are beginning to show interest in crypto as an asset class. As more of these funds devote a percentage of their portfolio to crypto, it could increase demand and higher prices.
Use of crypto for cross-border payments
One of the biggest benefits of cryptocurrency is its ability to make quick and inexpensive cross-border payments. As more individuals and businesses begin to use cryptocurrency for international transactions, this could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of crypto ATM’s continue to grow it will be more convenient for individuals to purchase and store cryptocurrency, which can boost demand and increase prices.
The development of security tokens
Security tokens, or digital assets that represent ownership of an asset, like stock or real estate is a fast-growing segment of the cryptocurrency market. As more security tokens are created and traded, this can lead to a higher demand and higher rates for the crypto.
More adoption by merchants
In the event that more retailers begin accepting cryptocurrency as a method of payment, this will make it easier for consumers to hold and use crypto, which could increase demand and price.
Will crypto be on the grow in 2023? The only way to know is time. However, with these aspects in mind, it’s likely that the cryptocurrency market will have a rebound by 2023. If you’re committed to the long haul Being patient and disciplined is crucial.