It’s been a rough ride for the crypto market in 2022. In November the market had dropped by 70 percent from the previous high on November 20, 2021. Just when the market was looking down and down, the FTX crash made them look 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 seen many dips over the years. Each time, it’s bounced back with a huge increase.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year before reaching a bottom of $150. But, in 2017, it broke the record, and hit a new highest of $19,600. In 2018, it was trading at $3,100. In 2020, it broke that resistance and reached a new highest of $68,000 in November 2021. Just like that, we’ve witnessed another drop. But history shows us that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips are typically followed by a prolonged bull run that finally breaks through the resistance created by the previous market’s highest price. This pattern can be seen in more than Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in the last few years. With more and more companies and industries taking to the technology, its use and acceptance is growing. From banking to gaming the use of crypto is increasing in a variety of ways. And this growing use case can lead to increasing participation in the market and, in turn, increase the price.
Increased institutional interest in cryptocurrency
In recent times we’ve noticed a growing demand from investors of institutional scale in cryptocurrency. From hedge funds to banks, many large institutions are now exploring the possibilities of crypto assets. This increased interest from institutions could bring more stability to the market for crypto and could lead to more expensive prices.
Regulations from the Government
As the market for crypto grows as it matures, governments all over the world are beginning to develop more favorable rules for crypto. This will help draw more investors and boost the acceptance of crypto in general.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrencies, blockchain, has a wide range of possible applications beyond the realm of financial transactions. From supply chain management to voting systems, more industries are starting to explore how they can benefit from blockchain technology. This could drive more investment and interest in crypto.
Technology advancements
Crypto and blockchain technology are still in the early stages of development. As advances continue to be made in areas such as security and scalability, potential of crypto assets will grow. This could result in more acceptance and higher prices.
Rising global economic uncertainty
Due to the constant economic uncertainty caused through the COVID-19 pandemic as well as other factors, more and more investors are beginning to look for safe haven investments like bitcoin and even gold. As the global economic situation remains uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only people who are interested in crypto. Retail investors, or individual investors, are also starting to get involved in the market for crypto. With increasing numbers of everyday people learn about crypto and the best ways to invest in it This could result in more demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the crypto market is maturing, more and more people are beginning to learn about and understand it. As the awareness and acceptance grows of crypto, this could lead to more people purchasing as well as holding the crypto that can drive up prices.
crypto chart patterns cheat sheet
Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market that enables the provision of financial services built using blockchain technology. As DeFi expands 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 market for crypto is growing, more and more companies are starting to accept crypto as a form of payment. This could lead to increased use of crypto in everyday transactions, and a rise in prices.
The increased investment of sovereign wealth funds
These funds are owned by the state as instruments for investing, are beginning to explore crypto as a potential asset class. As more funds dedicate a part or their entire portfolios to cryptocurrency, it could increase demand and increased prices.
Use of crypto for payment across borders
One of the main advantages of crypto is the ability to facilitate fast and cheap cross-border payments. As more individuals and businesses start to utilize cryptocurrency for international transactions, it could result in increased demand and higher prices.
An increasing number of crypto ATM’s
The number of crypto ATM’s continue to grow it will be easier for individuals to purchase and keep crypto, which could increase demand and price.
The development of security tokens
Security tokens, also known as digital assets that signify ownership in an asset like stock or real estate are rapidly expanding area of the crypto market. As more security tokens are created and traded, this could lead to increased demand and higher rates for the crypto.
Merchants are more likely to adopt the concept.
With the increasing number of businesses begin accepting crypto as a form of payment, it will make it easier for people to hold and use crypto, which could boost demand and increase prices.
So, will crypto increase in 2023? It’s only time to find out. With these things being considered, it’s possible that the crypto market could be able to see a rebound in 2023. For those committed to the long haul patience and discipline is crucial.