It’s been a difficult ride for the crypto market until 2022. By November, the market had dipped by more than 70 percent from the previous high in November 2021. When things were going downhill, the FTX crash turned them even more dire. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen its fair share of dips in the past. Each time, it’s bounced back with a big rise.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for a full year before reaching a bottom of $150. However, in 2017 it broke that record and reached a new highest of $19,600. Fast forward to 2018, and it was trading at $3,100. And in 2020, the price broke that resistance and hit a new high of $68,000 in November 2021. And just like that, we’ve seen another dip. However, the past has proven that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs are usually followed by a lengthy bull run that finally overcomes the resistance set by the market’s previous highest price. This is evident in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in the last few years. With more and more companies and industries embracing it, its usage and acceptance is growing. From gaming to finance the use of crypto is increasing in many ways. And this growing use case could lead to more people being involved in the crypto market which could increase the price.
The rise in interest of institutions in cryptocurrency
In the last few years, we’ve seen a growing demand from investors of institutional scale in crypto. From hedge funds to banks, many large institutions are starting to explore the possibilities of crypto assets. The increased interest of institutions can bring stability to the crypto market and could lead to more expensive prices.
Regulations of the government
As the market for crypto is maturing, governments around the world are beginning to establish more favorable rules for crypto. This is likely to attract more investors as well as increase the acceptance of crypto in general.
Blockchain has many more applications.
The technology that is the basis of the majority of cryptocurrencies, blockchain has a wide range of potential use cases beyond just financial transactions. From supply chain management to voting systems, more and more industries are beginning to look at ways they can make use of blockchain technology, which could stimulate more investment and excitement in crypto.
Blockchain and cryptocurrency technology is still in the beginning stages of development. As progress is made in areas such as scalability and security, the potential of crypto assets will expand. This could lead to greater use and increase in prices.
Global economic uncertainty is growing
Due to the constant economic uncertainty brought on due to the COVID-19 pandemic as well as other factors increasing numbers of investors are looking for safe haven assets such as gold and crypto. As the global economic situation is uncertain and uncertain, this could lead to more demand for crypto as well as increased prices.
Interest from retail investors
Investors from institutions aren’t the only people who are interested in crypto. Retail investors, or even individual investors, are also starting to get involved in the market for crypto. With increasing numbers of people are educated about cryptocurrency and investing in it this could result in more demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto grows increasing numbers of people are beginning to become aware about and appreciate the concept. As understanding and acceptance grows of crypto it could result in increasing numbers of people purchasing and holding crypto, which can drive up prices.
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Decentralized finance (DeFi) is an emerging area of the crypto market that enables financial services to be created using blockchain technology. As DeFi grows and more platforms and projects come online, this could result in increased use and increased prices for crypto.
The development of crypto payment methods
As the market for crypto continues to grow as more and more businesses are beginning using crypto to be a method of payment. This could lead to increased use of crypto in everyday transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
The sovereign wealth fund, also known as government-owned investment vehicles, are starting to explore crypto as an asset class. As more of these funds allocate a portion of their assets to digital currencies, this could result in a rise in demand and higher prices.
Use of crypto for payment across borders
One of the biggest benefits of cryptocurrency is its ability to make quick and inexpensive cross-border payments. As more and more people and businesses start to utilize cryptocurrency for international transactions this can lead to a rise in demand and higher costs.
The number of ATMs that accept crypto is increasing.
The number of crypto ATM’s continue to grow, it will become easier for people to buy and store cryptocurrency, which can drive up demand and prices.
Development of security tokens
Security tokens, which are digital assets that signify ownership of an asset, like stocks or real estate, are a rapidly growing sector of the crypto market. With the increasing number of security tokens being issued and traded, it could result in a rise in demand and higher costs for cryptocurrency.
A greater adoption rate by merchants
As more and more businesses start accepting crypto as a form of payment, it makes it easier for people to hold and use crypto, which can increase demand and price.
So, is crypto likely to rise in 2023? Only time will tell. But with these factors being considered, it’s possible that the crypto market will be able to see a rebound in 2023. For those looking to invest for the long-term Being patient and disciplined is crucial.