It’s been a tough ride for the crypto market in 2022. By November, the market had dipped by more than 70 percent from its previous high in November 2021. When things were looking down after the FTX crash turned things even worse. 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 over the years. Every time, it has bounced back with a big increase.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for over a year before hitting a low of $150. However, in 2017, it broke that record, and hit a new highest of $19,600. In 2018, and it was trading at $3,100. In 2020, it broke through the resistance and reached a new high of $68,000 in November 2021. And just like that, we’ve had another dip. However, the past has proven that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed previously, dips tend to be followed by a lengthy bull run that finally overcomes the resistance set by the previous high price. This pattern can be seen in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has made significant progress in recent years. With more and more companies and industries adopting the technology, its use and acceptance is rising. From gaming to finance, crypto is being used in many ways. And this growing use case could result in more people getting involved in the market and, in turn, drive the prices up.
The rise in interest of institutions in cryptocurrency
In recent times we’ve witnessed a rising interest from institutional investors in cryptocurrency. From banks to hedge funds, many large institutions are starting to explore the potential for crypto-based assets. The increased interest of institutions could provide more stability to the crypto market and lead to higher prices.
Government regulations
As the crypto market continues to mature as it matures, governments all over the world are beginning to establish more favorable regulations for cryptocurrency. This will help draw more investors and boost the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrencies, blockchain, is a broad range of possible applications beyond just financial transactions. In addition to supply chain management, voting and other systems companies are starting to explore how they can utilize blockchain technology. This will drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Crypto and blockchain technology are still in the early stages of development. As advancements continue to be made in areas such as security and scalability, potential of crypto assets will expand. This could lead to greater use and increase in prices.
Rising global economic uncertainty
In the current economic uncertainty brought on by the COVID-19 pandemic and other factors increasing numbers of investors are beginning to look for safe haven assets like bitcoin and even gold. Because the global economic climate remains uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in ones showing interest in cryptocurrency. Retail investors, also known as individual investors, are also starting to get involved in the market for crypto. With increasing numbers of everyday people learn about cryptocurrency and investing in it This could result in more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto is maturing increasing numbers of people are starting to learn about and understand it. As awareness and acceptance of cryptocurrency grows, it will lead to more people buying and holding crypto, which can raise prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market that allows the provision of financial services created upon blockchain technology. As DeFi grows and more platforms and projects become available, 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, more and more companies are beginning to accept crypto as a form 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 owned by the state as investment vehicles, are now beginning to show interest in crypto as an asset class. As more funds allocate a portion of their assets to digital currencies, this could result in a rise in demand and increased prices.
Utilization of crypto to make cross-border payments
One of the major benefits of crypto is its ability to make quick and inexpensive cross-border payments. As more businesses and individuals start to utilize cryptocurrency for international transactions, this could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
As the number of ATMs for crypto continue to grow it will be more convenient for consumers to purchase and hold crypto, which will boost demand and increase prices.
Development of security tokens
Security tokens, or digital assets that represent ownership in an asset like real estate or stock are rapidly expanding segment of the cryptocurrency market. Since more and more security tokens will be created and traded, it could lead to increased demand, and thus higher costs for cryptocurrency.
More adoption by merchants
With the increasing number of merchants start accepting crypto as a means of payment, this will make it more convenient for consumers to utilize and store crypto, which can increase demand and price.
Will crypto be on the increase in 2023? The only way to know is time. However, with these aspects being considered, it’s possible that the crypto market could be able to see a rebound in 2023. If you’re committed to the long haul Being patient and disciplined is essential.