It’s been a difficult experience for the crypto market through 2022. In November the market had dropped by more than 70% from its previous peak in November 2021. When things were going downhill and down, the FTX crash turned things even worse. What is the likelihood that the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has experienced many dips in the past. And every time, it has 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 hitting a low of $150. However, in 2017, it broke that record, and hit a new record high of $19,600. In 2018, and it was trading at $3,100. And in 2020, the price broke through the resistance and reached a new high of $68,000 in November 2021. And just like that, we’ve witnessed another drop. However, history has shown us that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen in the past, dips are usually followed by a lengthy bull run that eventually breaks through the resistance created by the previous high price. This pattern is evident in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in recent years. With more and more businesses and industries embracing it, its usage and acceptance is increasing. From gaming to finance cryptocurrency is being utilized in many ways. And this growing use case can lead to more people being involved in the market, which in turn could drive the prices up.
Increased institutional interest in cryptocurrency
In the last few years we’ve witnessed a rising demand from investors of institutional scale in cryptocurrency. From banks to hedge funds and even large corporations are starting to explore the potential of crypto assets. The increasing interest from institutions could bring more stability to the market for crypto and could lead to higher prices.
Government regulations
As the market for crypto grows, governments around the world are beginning to establish more favorable regulations for crypto. This is likely to attract more investors and boost the adoption rate of crypto.
Blockchain has many more applications.
The underlying technology behind many cryptocurrency, blockchain, offers a variety of potential use cases that go beyond financial transactions. In addition to supply chain management, voting and other systems and more industries are starting to explore how they can make use of blockchain technology. This will stimulate more investment and excitement in cryptocurrency.
Advancements in technology
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas such as scalability and security, the potential of cryptocurrency assets will continue to expand. This could lead to greater acceptance and higher prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty caused by the COVID-19 pandemic and other factors, more and more investors are looking for safe haven assets such as cryptocurrency and gold. Because the global economic climate is uncertain, this could lead to more demand for crypto as well as more expensive prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only people who are interested in cryptocurrency. Retail investors, or even individual investors, are also starting to get involved in the market for crypto. As more and more everyday people are educated about cryptocurrency and investing in it this could result in increased demand and higher prices.
Growing awareness and acceptance of cryptocurrency
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, this could lead to more people purchasing and holding crypto, which could drive up prices.
crypto crew llc reviews
Financial decentralization (DeFi) is an emerging area of the crypto market, which allows the provision of financial services created upon blockchain technology. As DeFi expands and more projects and platforms come online, this could result in increased use and more expensive prices for crypto.
The development of crypto payment methods
As the crypto market is growing increasing numbers of companies are beginning accepting crypto payments as a method of payment. This could lead to an increase in the usage of crypto in daily transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as state-owned investment vehicles, are now beginning to explore crypto as an asset class. As more funds devote a percentage of their assets to digital currencies, it could increase demand and more expensive prices.
Cryptocurrency is used for cross-border payments
One of the major benefits of crypto is the ability to make fast and cheap cross-border payments. As more individuals and businesses start to utilize cryptocurrency for international transactions, this could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
As the number 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 are used to represent ownership of an asset, such as stock or real estate are rapidly expanding segment of the cryptocurrency market. Since more and more security tokens will be issued and traded, it could result in a rise in demand, and thus higher rates for the crypto.
A greater adoption rate by merchants
In the event that more merchants start accepting crypto as a means of payment, it will make it more convenient for customers to use and hold crypto, which could increase demand and price.
So, is crypto likely to rise in 2023? It’s only time to find out. With these things to consider, it’s likely that the crypto market will see a recovery in 2023. If you’re looking to invest for the long run Being patient and disciplined is crucial.