It’s been a difficult experience for the crypto market in 2022. As of November, the market had dipped by more than 70 percent from the previous high in November 2021. When things were getting worse, the FTX crash turned things even worse. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced its fair share of dips over the years. Every time, it’s rebounded with a big increase.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year, reaching a low of $150. But, in 2017, it broke the record and reached a new highest of $19,600. In 2018, the price was at $3,100. And in the year 2020 it struck that resistance and hit a new high of $68,000 in November 2021. Then, just like that we’ve seen another dip. But history shows us that after each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
As we’ve seen before, fall-offs are usually followed by a prolonged bull run that eventually breaks through the resistance created by the market’s previous highest price. This pattern can be seen not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in the last few years. With more and more businesses and industries adopting the technology, its use and acceptance is increasing. From gaming to finance, crypto is being used in many ways. And this growing use case could lead to more people getting involved in the market which could boost prices.
A rise in the interest of institutions for crypto
In recent years we’ve noticed a growing curiosity from institutions investing in cryptocurrency. From hedge funds to banks, many large institutions are now exploring the possibilities of crypto assets. The increased interest of institutions could provide more stability to the market for crypto and could lead to greater prices.
Regulations of the government
As the market for crypto is maturing, governments around the world are beginning to establish more favorable rules for cryptocurrency. This is likely to attract more investors and boost the adoption rate of crypto.
A broader range of blockchain applications
The underlying technology behind the majority of cryptocurrencies, blockchain offers a variety of possible applications beyond the realm of financial transactions. For example, from supply chain management and voting, many and more industries are beginning to look at ways they can utilize blockchain technology. This could drive more investment and interest in crypto.
Technology advancements
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas like scalability and security, the potential of crypto assets will continue to increase. This could lead to greater use and increase in prices.
Rising global economic uncertainty
Due to the constant economic uncertainty brought on through the COVID-19 pandemic and other factors, more and more investors are starting to look for safe haven assets like bitcoin and even gold. As the global economic situation is uncertain it could result in more demand for crypto as well as more expensive prices.
Interest from retail investors
The institutional investors aren’t alone in one who’s showing an interest in cryptocurrency. Retail investors, or individual investors, are also starting to invest in the cryptocurrency market. As more and more 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 market for crypto continues to mature increasing numbers of people are beginning to become aware about and appreciate it. As awareness and acceptance of cryptocurrency grows, this could lead to more people purchasing or holding cryptocurrency, and this could increase prices.
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Decentralized finance (DeFi) is an emerging area of the crypto market, which allows the provision of financial services built using blockchain technology. As DeFi grows and more platforms and projects are launched, it could lead to increased adoption and more expensive prices for crypto.
The development of crypto payment methods
As the crypto market grows as more and more businesses are starting using crypto to be a form of payment. This could lead to increased use of crypto in regular transactions, and a rise in prices.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are state-owned investment vehicles, are beginning to show interest in cryptocurrency as a possible asset class. As more of these funds devote a percentage of their portfolio to crypto, it could lead to increased demand and increased prices.
Use of crypto for payment across borders
One of the main advantages of crypto is the ability to make fast and cheap cross-border payments. As more individuals and businesses start to utilize crypto for international transactions, this could lead to increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
As the number of ATMs for crypto increase it will be easier for individuals to purchase and store cryptocurrency, which can increase demand and price.
The development of security tokens
Security tokens, or digital assets that represent ownership in an asset like stock or real estate are rapidly expanding area of the crypto market. With the increasing number of security tokens being issued and traded, it could lead to increased demand and higher prices for crypto.
More adoption by merchants
In the event that more retailers accept crypto as a means of payment, this makes it easier for people to use and hold crypto, which can boost demand and increase prices.
Will crypto be on the rise in 2023? It’s only time to find out. With these things in mind, it’s possible that the crypto market could see a recovery in 2023. If you’re committed to the long-term Being patient and disciplined is crucial.