It’s been a difficult journey for the cryptocurrency market in 2022. In November, the market had dipped by 70 percent from its previous high at the end of November. When things were looking down and down, the FTX crash made them look 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 seen its fair share of drops in the past. And every time, it has bounced back with a big rise.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for more than a year before hitting a low of $150. In 2017, it broke that record, and hit a new record high of $19,600. Fast forward to 2018, the price was at $3,100. In 2020, the price broke through the resistance and reached a new high of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. However, history has shown us that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
As we’ve seen previously, dips are typically followed by a prolonged bull run, which eventually surpasses the resistance created by the previous high price. This is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in recent years. With more and more businesses and industries adopting it, its usage and acceptance is increasing. From finance to gaming, crypto is being used in a variety of ways. The growing popularity of crypto can lead to increasing participation in the crypto market, which in turn could boost prices.
The rise in interest of institutions in cryptocurrency
In recent times we’ve witnessed a rising curiosity from institutions investing in crypto. From banks to hedge funds and even large corporations are beginning to investigate the potential for crypto-based assets. This increased interest from institutions could provide more stability to the market for crypto and result in higher prices.
Government regulations
As the market for crypto continues to mature, governments around the world are beginning to establish more favorable regulations for cryptocurrency. This is likely to attract more investors and increase the mainstream adoption of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrencies, blockchain, is a broad range of possible applications beyond just financial transactions. For example, from supply chain management and voting, many industries are starting to explore how they can benefit from blockchain technology, which could drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is still in the beginning stages of development. As advances continue to be made in areas like scalability and security, the potential of cryptocurrency assets will continue to increase. This could lead to more use and increase in 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 looking for safe haven assets like gold and crypto. As the global economic situation remains uncertain, this could lead to an increase in demand for crypto and more expensive prices.
Retail investors are able to earn interest
Institutional investors aren’t the only ones showing interest in cryptocurrency. Retail investors, or individual investors, are also starting to get involved in the crypto market. With increasing numbers of people are educated about crypto and how to invest in it this could result in an increase in demand and consequently higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market grows increasing numbers of people are beginning to become aware about it and comprehend it. As understanding and acceptance of cryptocurrency grows it could result in increasing numbers of people purchasing as well as holding the crypto that could raise prices.
crypto buy sell indicator
Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market that allows financial services to be built upon blockchain technology. As DeFi continues to grow and more projects and platforms become available, this could result in increased use and higher prices for crypto.
Developments in crypto payment methods
As the crypto market is growing, more and more companies are starting to accept crypto as a method of payment. This could lead to increased use of crypto in regular transactions, and a rise in prices.
More investment from sovereign wealth funds
Sovereign wealth funds, which are government-owned investments, are starting to show interest in crypto as a potential asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, this could lead to increased demand and increased prices.
Utilization of crypto to make payment across borders
One of the biggest benefits of crypto is its ability to make swift and affordable cross-border transactions. As more businesses and individuals start to utilize cryptocurrency for international transactions this could lead to increased the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
The number of ATMs for crypto increase, it will become easier for consumers to purchase and hold crypto, which will boost demand and increase prices.
Security tokens are developed for development
Security tokens, also known as digital assets that signify ownership in an asset such as stock or real estate, are a rapidly growing segment of the cryptocurrency market. As more security tokens are issued and traded, this can lead to a higher demand, and thus higher rates for the crypto.
Merchants are more likely to adopt the concept.
As more and more businesses begin accepting cryptocurrency as a method of payment, this will make it more convenient for customers to hold and use crypto, which can boost demand and increase prices.
So, will crypto grow in 2023? The only way to know is time. With these things being considered, it’s possible that the crypto market could see a recovery in 2023. And for those who are looking to invest for the long run, being patient and disciplined is crucial.