It’s been a rough ride for the crypto market in 2022. By November, the market had dipped by more than 70% from its previous peak in November 2021. Just when the market was going downhill after the FTX crash turned things even more dire. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had many dips in the past. And every time, it’s rebounded with a big rally.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for more than a year before reaching a bottom of $150. However, in 2017, it broke the record, and hit a new record high of $19,600. Fast forward to 2018, it was trading at $3,100. And in the year 2020 it struck through the resistance and hit a new highest of $68,000 in November 2021. And just like that, we’ve seen another dip. But history shows us that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
As we’ve seen previously, dips are typically followed by a long bull run, which 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 come a long way in recent years. With more and more companies and industries taking to it, its usage and acceptance is increasing. From banking to gaming, crypto is being used in a myriad of ways. And this growing use case could result in increasing participation in the crypto market and, in turn, boost prices.
Increased institutional interest in cryptocurrency
In the last few years, we’ve seen a growing curiosity from institutions investing in cryptocurrency. From hedge funds to banks, many large institutions are beginning to investigate the potential for crypto-based assets. The increased interest of institutions can bring stability to the market for crypto and lead to higher prices.
Regulations of the government
As the market for crypto is maturing and mature, governments across the globe are beginning to develop more favorable rules for cryptocurrency. This could help attract more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The underlying technology behind many cryptocurrency, blockchain, offers a variety of potential use cases beyond just financial transactions. In addition to supply chain management, voting and other systems and more industries are starting to explore how they can utilize blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Crypto and blockchain technology are at the very beginning of development. As progress is made in areas such as security and scalability, potential of crypto assets will grow. This could result in more acceptance and higher prices.
Uncertainty in the global economy
Due to the constant instability in the economy caused 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. Because the global economic climate remains uncertain it could result in more demand for crypto as well as increased prices.
Retail investors are able to earn interest
Institutional investors aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, or individual investors, are also starting to get involved in the market for crypto. As more and more people learn about cryptocurrency and investing in it This could result in more demand and higher prices.
The growing awareness and acceptance of crypto
As the market for crypto continues to mature, more and more people are beginning to learn about and understand the concept. As awareness and acceptance grows of crypto, this could lead to more people purchasing and holding crypto, which could raise prices.
crypto all stars
The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market, which allows financial services to be created using blockchain technology. As DeFi expands and more platforms and projects are launched, it will lead to a rise in adoption and more expensive prices for crypto.
Advances in crypto-based payment methods
As the market for crypto grows increasing numbers of companies are beginning to accept crypto as a means of payment. This could lead to an increase in the use of crypto in everyday transactions, and a rise in prices.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are owned by the state as instruments for investing, are starting to show interest in cryptocurrency as a possible asset class. As more of these funds allocate a portion or their entire portfolios to cryptocurrency, this could lead to increased demand and increased prices.
Use of crypto for payment across borders
One of the major benefits of cryptocurrency is its ability to facilitate fast and cheap cross-border payments. As more individuals and businesses start to utilize cryptocurrency for international transactions, this can lead to a rise in the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
The number of ATMs for crypto continue to grow it will be easier for individuals to purchase and hold crypto, which will drive up demand and prices.
The development of security tokens
Security tokens, which are digital assets that represent ownership of an asset, such as stocks or real estate is a fast-growing sector of the crypto market. As more security tokens are created and traded, it could lead to increased demand and consequently higher prices for crypto.
Merchants are more likely to adopt the concept.
In the event that more merchants begin accepting crypto as a means of payment, it makes it easier for customers to use and hold crypto, which could increase demand and price.
Will crypto be on the increase in 2023? It’s only time to find out. With these things to consider, it’s likely that the cryptocurrency market will see a recovery in 2023. And for those who are committed to the long run, being patient and disciplined is essential.