It’s been a tough experience for the crypto market until 2022. By November the market had dropped by 70 percent from the previous high at the end of November. Just when the market was getting worse, the FTX crash turned them worse. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many dips over the years. Each time, it’s rebounded with a big rally.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for more than a year, reaching a low of $150. However, in 2017 it broke that record, and hit a new highest of $19,600. In 2018, the price was at $3,100. And in the year 2020 it struck through that resistance and reached a new highest of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. 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 tend to be followed by a prolonged bull run that eventually overcomes the resistance set by the previous high price. This is evident in more than Bitcoin but also in other cryptocurrency.
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 embracing it, its usage and acceptance is increasing. From finance to gaming, crypto is being used in a myriad of ways. The growing popularity of crypto could result in more people being involved in the crypto market and, in turn, boost prices.
Increased institutional interest in crypto
In the last few years we’ve noticed a growing interest from institutional investors in crypto. From banks to hedge funds and even large corporations are beginning to investigate the possibilities in crypto currencies. The increasing interest from institutions could provide more stability to the market for crypto and result in more expensive prices.
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 increase the mainstream adoption of crypto.
More use cases for blockchain
The underlying technology behind many cryptocurrency, blockchain, has a wide range of applications that go that go beyond financial transactions. In addition to supply chain management, voting and other systems industries are exploring ways they can utilize blockchain technology. This will increase investment and enthusiasm in cryptocurrency.
Crypto and blockchain technology are at the very beginning of development. As progress is made in areas such as scalability and security, the potential of crypto assets will expand. This could result in more adoption and higher prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty brought on through the COVID-19 pandemic and other factors increasing numbers of investors are beginning to look for safe haven assets like gold and crypto. Because the global economic climate is uncertain and uncertain, this could lead to more demand for crypto as well as more expensive prices.
Interest from retail investors
Institutional investors aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, or even individual investors are also beginning to get involved in the crypto market. In the future, as more everyday people learn about cryptocurrency and investing in it, this could lead to more demand and higher prices.
Growing awareness and acceptance of crypto
As the crypto market is maturing increasing numbers of people are beginning to become aware about and understand the concept. As awareness and acceptance grows of crypto it could result in more people buying as well as holding the crypto that could drive up prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market, which allows the provision of financial services created on top of blockchain technology. As DeFi expands 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 crypto market continues to grow, more and more companies are starting accepting crypto payments as a method of payment. This could lead to increased usage of crypto in daily transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are owned by the state as investment vehicles, are beginning to explore crypto as a potential asset class. As more funds devote a percentage of their assets to digital currencies, it could lead to increased demand and increased prices.
Cryptocurrency is used for payment across borders
One of the major benefits of crypto is the ability to facilitate swift and affordable cross-border transactions. As more individuals and businesses begin to use cryptocurrency for international transactions, it could result in increased demand and higher costs.
Increasing numbers of crypto ATM’s
With the amount of ATMs for crypto continue to grow, it will become easier for consumers to purchase and hold crypto, which will drive up demand and prices.
Security tokens are developed for development
Security tokens, also known as digital assets that signify ownership in an asset such as real estate or stock are rapidly expanding segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, it can lead to a higher demand and higher rates for the crypto.
A greater adoption rate by merchants
In the event that more merchants begin accepting crypto as a means of payment, it will make it easier for customers to utilize and store crypto, which could boost demand and increase prices.
So, is crypto likely to grow in 2023? It’s only time to find out. But with these factors to consider, it’s possible that the cryptocurrency market will be able to see a rebound in 2023. For those in it for the long haul Being patient and disciplined is essential.