It’s been a difficult experience for the crypto market until 2022. In November, the market had dipped by 70 percent from the previous high in November 2021. Just when the market was looking down after 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 had its fair share of dips over the years. Every time, it’s bounced back with a huge rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year before reaching a bottom of $150. In 2017, it broke that record and hit a record record high of $19,600. In 2018, and it was trading at $3,100. And in 2020, the price broke through that resistance and hit a new high of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. However, the past has proven that at the end of every dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs tend to be followed by a prolonged bull run that eventually breaks through the resistance created by the previous high price. This pattern can be seen in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in recent years. With more and more companies and industries adopting it, its usage and acceptance is increasing. From gaming to finance cryptocurrency is being utilized in a myriad of ways. This growing demand could lead to more people being involved in the market which could boost prices.
A rise in the interest of institutions for cryptocurrency
In the last few years, we’ve seen a growing demand from investors of institutional scale in cryptocurrency. From banks to hedge funds, many large institutions are now exploring the potential in crypto currencies. This increased interest from institutions could bring more stability to the crypto market and could lead to greater prices.
As the crypto market grows as it matures, governments all over the world are beginning to develop more favorable regulations for cryptocurrency. This will help draw more investors as well as increase the acceptance of crypto in general.
A broader range of blockchain applications
The technology that underlies many cryptocurrencies, blockchain, offers a variety of potential use cases beyond the realm of financial transactions. In addition to supply chain management, voting and other systems and more industries are beginning to look at ways they can utilize blockchain technology. This could increase investment and enthusiasm in crypto.
Advancements in technology
Blockchain technology and cryptography are still in the beginning stages of development. As advances continue to be made in areas like security and scalability, potential of crypto assets will continue to expand. This could lead to greater use and increase in prices.
Uncertainty in the global economy
With the ongoing instability in the economy caused by the COVID-19 pandemic as well as other factors increasing numbers of investors are starting to look for safe haven assets such as gold and crypto. Because the global economic climate remains uncertain and uncertain, this could lead to an increase in demand for crypto and higher 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 beginning to participate in the cryptocurrency market. In the future, as more everyday people become aware of cryptocurrency and investing in it this could result in an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the market for crypto is maturing increasing numbers of people are starting to learn about it and comprehend the concept. As understanding and acceptance of cryptocurrency grows it could result in more people buying or holding cryptocurrency, and this can raise prices.
Decentralized finance (DeFi) is an emerging area of the crypto market, which allows financial services to be created using blockchain technology. As DeFi grows and more projects and platforms are launched, it could result in increased use and more expensive prices for crypto.
Developments in crypto payment methods
As the crypto market grows increasing numbers of companies are beginning using crypto to be a form of payment. This could lead to increased use of crypto in regular transactions, and a rise in prices.
The increased investment of sovereign wealth funds
These funds are owned by the state as investment vehicles, are now beginning to show interest in cryptocurrency as a possible asset class. As more of these funds devote a percentage of their portfolio to crypto, this could lead to increased demand and more expensive prices.
Cryptocurrency is used for payment across borders
One of the major benefits of crypto is its ability to make swift and affordable cross-border transactions. As more individuals and businesses begin to use cryptocurrency for international transactions, this can lead to a rise in demand and higher prices.
The number of ATMs that accept crypto is increasing.
As the number of ATMs for crypto increase, it will become easier for people to buy and hold cryptocurrency, which can drive up demand and prices.
The development of security tokens
Security tokens, also known as digital assets that are used to represent ownership in an asset like real estate or stock are rapidly expanding segment of the cryptocurrency market. With the increasing number of security tokens being created and traded, this could result in a rise in demand and higher costs for cryptocurrency.
Merchants are more likely to adopt the concept.
In the event that more businesses start accepting cryptocurrency as a method of payment, it makes it easier for consumers to utilize and store crypto, which can increase demand and price.
So, will crypto rise in 2023? Only time will tell. However, with these aspects to consider, it’s possible that the crypto market could see a recovery in 2023. For those committed to the long run Being patient and disciplined is crucial.