It’s been a rough journey for the cryptocurrency market through 2022. By November the market had dropped by 70 percent from the previous high in November 2021. Just when the market was going downhill and down, the FTX crash turned them even more dire. What is the likelihood that the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen its fair share of drops in the past. Each time, it has bounced back by a massive increase.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for over a year, reaching a low of $150. In 2017, it broke that record and reached a new high of $19,600. Then, in 2018, and it was trading at $3,100. And in 2020, the price broke through the resistance, and reached a record peak of $68,000 in the month of November 2021. And just like that, we’ve had another dip. However, the past has proven 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 tend to be followed by a long bull run that finally surpasses the resistance created by the previous high price. This is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in the last few years. With more and better companies and industries adopting the technology, its use and acceptance is increasing. From finance to gaming the use of crypto is increasing in a myriad of ways. And this growing use case could lead to more people being involved in the crypto market which could boost prices.
The rise in interest of institutions in crypto
In the last few years we’ve noticed a growing interest from institutional investors in cryptocurrency. From banks to hedge funds, many large institutions are beginning to investigate the possibilities in crypto currencies. The increased interest of institutions could bring more stability to the market for crypto and could lead to more expensive prices.
As the market for crypto is maturing and mature, governments across the globe are starting to create more favorable regulations for crypto. This could help attract more investors and increase the adoption rate of crypto.
More use cases for blockchain
The underlying technology behind the majority of cryptocurrencies, blockchain is a broad range of potential use cases beyond the realm of financial transactions. In addition to supply chain management, voting and other systems companies are exploring ways they can utilize blockchain technology, which could stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the beginning stages of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will expand. This could lead to greater adoption and higher prices.
Rising global economic uncertainty
In the current instability in the economy caused due to the COVID-19 pandemic and other factors many investors are beginning 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 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 beginning to get involved in the market for crypto. As more and more people are educated about cryptocurrency and investing in it This could result in increased demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the crypto market grows, more and more people are beginning to learn about and understand it. As the awareness and acceptance grows of crypto, it will lead to more people purchasing as well as holding the crypto that could drive up prices.
crypto digital marketing
Financial decentralization (DeFi) is a rapidly growing area of the crypto market that allows financial services to be developed on top of blockchain technology. As DeFi grows and more platforms and projects become available, this could result in increased use and higher prices for crypto.
Developments in crypto payment methods
As the crypto market is growing increasing numbers of companies are starting accepting crypto payments as a method of payment. This could lead to an increase in the use of crypto in regular transactions and higher prices.
The increased investment of sovereign wealth funds
Sovereign wealth funds, which are owned by the state as investment vehicles, are beginning to explore crypto as a potential asset class. As more funds dedicate a part of their portfolio to crypto, it could result in a rise in demand and increased prices.
Utilization of crypto to make international payments
One of the biggest benefits of crypto is the capability to perform quick and inexpensive cross-border payments. As more businesses and individuals start to utilize crypto for international transactions, it could result in increased demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of crypto ATM’s continue to increase, it will become easier for consumers to purchase and keep cryptocurrency, which can drive up demand and prices.
Development of security tokens
Security tokens, which are digital assets that represent ownership in an asset such as stock or real estate is a fast-growing area of the crypto market. As more security tokens are created and traded, it could lead to increased demand, and thus higher rates for the crypto.
Merchants are more likely to adopt the concept.
In the event that more retailers accept cryptocurrency as a method of payment, it will make it easier for consumers to hold and use cryptocurrency, which will boost demand and increase prices.
Will crypto be on the grow in 2023? Only time will tell. However, with these aspects to consider, it’s likely that the cryptocurrency market will have a rebound by 2023. For those committed to the long run, being patient and disciplined will be key.