It’s been a difficult journey for the cryptocurrency market until 2022. As of November the market was down by 70% from its previous peak on November 20, 2021. When things were getting worse and down, the FTX crash turned things even worse. What is the likelihood that the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced its fair share of dips in the past. Each time, it’s rebounded with a big increase.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for a full year before reaching a bottom of $150. However, in 2017 it broke that record, and hit a new high of $19,600. Then, in 2018, it was trading at $3,100. In 2020, it broke through that resistance and hit a new highest of $68,000 in November 2021. Just like that, we’ve seen another dip. However, history has shown us that following each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen in the past, dips tend to be followed by a lengthy bull run that eventually breaks through the resistance created by the previous high price. This is evident not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in the last few years. With more and better companies and industries adopting it, its usage and acceptance is increasing. From banking to gaming the use of crypto is increasing in a variety of ways. The growing popularity of crypto could lead to increasing participation in the crypto market, which in turn could increase the price.
A rise in the interest of institutions for cryptocurrency
In the last few years, we’ve seen a growing curiosity from institutions investing in crypto. From hedge funds to banks, many large institutions are now exploring the possibilities for crypto-based assets. The increased interest of institutions could bring more stability to the market for crypto and result in greater prices.
Regulations from the Government
As the crypto market continues to mature, governments around the world are beginning to develop more favorable rules for cryptocurrency. This is likely to attract more investors and increase the acceptance of crypto in general.
A broader range of blockchain applications
The technology that is the basis of the majority of cryptocurrencies, blockchain is a broad range of potential use cases that go beyond financial transactions. In addition to supply chain management, voting and other systems and more industries are beginning to look at ways they can make use of blockchain technology, which could increase investment and enthusiasm in crypto.
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 continue to expand. This could result in more 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 starting to look for safe haven investments like cryptocurrency and gold. As the global economic situation is uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Interest from retail investors
The institutional investors aren’t alone in one who’s showing an interest in crypto. Retail investors, or even individual investors are also beginning to get involved in the cryptocurrency market. With increasing numbers of people learn about crypto and the best ways to invest 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 continues to mature increasing numbers of people are beginning to learn about and appreciate the concept. As awareness and acceptance of crypto grows, this could lead to increasing numbers of people purchasing or holding cryptocurrency, and this can raise prices.
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The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market that enables finance services created on top of blockchain technology. As DeFi grows and more platforms and projects are launched, it could lead to increased adoption and increased prices for crypto.
Advances in crypto-based payment methods
As the crypto market continues to grow, more and more companies are starting to accept crypto as a means of payment. This could lead to an increase in the use of crypto in regular transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
These funds are government-owned investment vehicles, are starting to explore crypto as an 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 international payments
One of the major benefits of crypto is its ability to make swift and affordable cross-border transactions. As more and more people and businesses begin to use crypto for international transactions, this could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
As the number of ATMs that accept crypto continue to increase it will be more convenient for people to buy and keep crypto, which could increase demand and price.
Development of security tokens
Security tokens, which are digital assets that represent ownership in an asset such as stocks or real estate are rapidly expanding area of the crypto market. Since more and more security tokens will be issued and traded, it could lead to increased demand, and thus higher costs for cryptocurrency.
More adoption by merchants
In the event that more retailers accept crypto as a means of payment, it will make it easier for consumers to hold and use crypto, which can increase demand and price.
So, is crypto likely to increase in 2023? Only time will tell. However, with these aspects being considered, it’s likely that the crypto market will have a rebound by 2023. And for those who are committed to the long-term Being patient and disciplined is crucial.