It’s been a tough experience for the crypto market until 2022. In November, the market had dipped by more than 70 percent from its previous high at the end of November. And just when things were looking down and down, the FTX crash turned them more dire. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had many dips in the past. Every time, it has bounced back with a big increase.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for a full year before hitting a low of $150. In 2017, it broke the record, and hit a new high of $19,600. Fast forward to 2018, the price was at $3,100. And in 2020, it broke through that resistance and reached a new highest of $68,000 in November 2021. And just like that, we’ve had another dip. However, history has shown us that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs are usually followed by a lengthy bull run, which eventually surpasses the resistance created by the market’s previous highest price. This pattern can be seen not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in the last few years. With more and more businesses and industries adopting it, its usage and acceptance is growing. From banking to gaming, crypto is being used in a myriad of ways. The growing popularity of crypto could result in increasing participation in the market which could increase the price.
Increased institutional interest in crypto
In recent years we’ve noticed a growing curiosity from institutions investing in crypto. From banks to hedge funds numerous large institutions are beginning to investigate the possibilities for crypto-based assets. The increased interest of institutions can bring stability to the crypto market and lead to higher prices.
Regulations of the government
As the market for crypto continues to mature, governments around the world are beginning to establish more favorable regulations for crypto. This could help attract more investors as well as increase the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrencies, blockchain, has a wide range of possible applications beyond the realm of financial transactions. In addition to supply chain management, voting and other systems industries are beginning to look at ways they can make use of blockchain technology. This will increase investment and enthusiasm in crypto.
Blockchain technology and cryptography are still in the beginning stages of development. As progress is made in areas such as security and scalability, potential of crypto assets will continue to expand. This could result in more acceptance and higher prices.
Global economic uncertainty is growing
Due to the constant instability in the economy caused due to the COVID-19 pandemic as well as other factors, more and more investors are looking for safe haven assets such as gold and crypto. Since the economic outlook for the world is uncertain, this could lead to an increase in demand for crypto and more expensive prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in one who’s showing an interest in crypto. Retail investors, or individual investors, are also starting to get involved in the crypto market. In the future, as more people become aware of crypto and the best ways to invest in it This could result in increased demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto is maturing, more and more people are beginning to learn about it and comprehend it. As awareness and acceptance grows of crypto, this could lead to increasing numbers of people purchasing as well as holding the crypto that could increase prices.
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Financial decentralization (DeFi) is a rapidly growing area of the crypto market that allows financial services to be created on top of blockchain technology. As DeFi expands and more platforms and projects are launched, it could result in increased use and higher prices for crypto.
Developments in crypto payment methods
As the market for crypto is growing, more and more companies are starting accepting crypto payments as a method of payment. This could lead to an increase in the use of crypto in everyday transactions, and a rise in prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned instruments for investing, are starting to show interest in crypto as a potential asset class. As more funds allocate a portion or their entire portfolios to cryptocurrency, it could increase demand and increased prices.
Cryptocurrency is used for cross-border payments
One of the main advantages of cryptocurrency is its ability to facilitate quick and inexpensive cross-border payments. As more individuals and businesses start to utilize cryptocurrency for international transactions, this can lead to a rise in the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
The number of crypto ATM’s continue to grow it will be easier for people to buy and keep cryptocurrency, which can boost demand and increase prices.
Security tokens are developed for development
Security tokens, which are digital assets that are used to represent ownership of an asset, such as stock or real estate are rapidly expanding sector of the crypto market. With the increasing number of security tokens being created and traded, this could result in a rise in demand, and thus higher rates for the crypto.
A greater adoption rate by merchants
With the increasing number of merchants begin accepting cryptocurrency as a method of payment, it makes it easier for consumers to use and hold crypto, which can drive up demand and prices.
Will crypto be on the grow in 2023? It’s only time to find out. With these things to consider, it’s possible that the crypto market will be able to see a rebound in 2023. If you’re committed to the long run patience and discipline is crucial.