It’s been a difficult ride for the crypto market through 2022. As of November the market had dropped by more than 70 percent from its previous high at the end of November. Just when the market was looking down after the FTX crash turned them even worse. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen its fair share of dips in the past. Each time, it’s bounced back by a massive rise.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for more than a year before hitting a low of $150. But, in 2017, it broke the record, and hit a new high of $19,600. In 2018, it was trading at $3,100. And in 2020, it broke through the resistance and reached a new peak of $68,000 in the month of November 2021. 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 long bull run that finally overcomes the resistance set by the previous high price. This pattern is evident in not just 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 adopting it, its usage and acceptance is rising. From finance to gaming the use of crypto is increasing in many ways. The growing popularity of crypto could result in increasing participation in the crypto market which could boost prices.
A rise in the interest of institutions for cryptocurrency
In recent years we’ve witnessed a rising demand from investors of institutional scale in crypto. From banks to hedge funds and even large corporations are now exploring the potential 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 starting to create more favorable regulations for crypto. This will help draw more investors as well as increase 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 that go beyond financial transactions. From supply chain management to voting systems, more and more industries are exploring ways they can benefit from blockchain technology, which could stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is still in the early stages of development. As progress is made in areas like security and scalability, the potential of crypto assets will continue to increase. This could lead to greater adoption and higher prices.
Uncertainty in the global economy
With the ongoing economic uncertainty brought on due to the COVID-19 pandemic, as well as other causes, more and more investors are starting to look for safe haven assets such as bitcoin and even gold. Because the global economic climate is uncertain it could result in more demand for crypto as well as higher prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only people who are interested in cryptocurrency. Retail investors, also known as individual investors, are also starting to invest in the crypto market. In the future, as more everyday people are educated about cryptocurrency and investing in it, this could lead to an increase in demand and consequently higher prices.
The growing awareness and acceptance of crypto
As the crypto market grows, more and more people are beginning to become aware about it and comprehend it. As understanding and acceptance of cryptocurrency grows, it will lead to more people buying and holding crypto, which could increase prices.
crypto betting app
The Decentralized Finance (DeFi) is an emerging area of the crypto market that enables finance services developed using blockchain technology. As DeFi expands and more projects and platforms become available, this will lead to a rise in adoption and more expensive prices for crypto.
Advances in crypto-based payment methods
As the crypto market is growing, more and more companies are beginning using crypto to be a method of payment. This could lead to increased usage of crypto in daily transactions and higher prices.
The increased investment of sovereign wealth funds
These funds are government-owned investment vehicles, are now beginning to explore cryptocurrency as a possible asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, this could lead to increased demand and higher prices.
Utilization of crypto to make international payments
One of the main advantages of crypto is the 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 the demand for it and a rise in prices.
An increasing number of crypto ATM’s
The number of ATMs that accept crypto continue to grow it will be more convenient for individuals to purchase and keep crypto, which will increase demand and price.
The development of security tokens
Security tokens, also known as digital assets that signify ownership in an asset like stocks or real estate, are a rapidly growing segment of the cryptocurrency market. As more security tokens are created and traded, this could lead to increased demand and higher costs for cryptocurrency.
A greater adoption rate by merchants
With the increasing number of merchants begin accepting crypto as a means of payment, this will make it easier for people to utilize and store crypto, which can drive up demand and prices.
Will crypto be on the rise in 2023? It’s only time to find out. However, with these aspects in mind, it’s possible that the cryptocurrency market will have a rebound by 2023. And for those who are looking to invest for the long-term, being patient and disciplined is essential.