It’s been a difficult experience for the crypto market until 2022. By November, the market had dipped by more than 70 percent from the previous high at the end of November. And just when things were getting worse and down, the FTX crash turned things even worse. The question is, can the cryptocurrency market rebound 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 huge rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for over a year before reaching a bottom of $150. However, in 2017 it broke that record and hit a record highest of $19,600. Fast forward to 2018, the price was at $3,100. And in the year 2020 it struck through the resistance and reached a new highest of $68,000 in November 2021. Then, just like that we’ve had another dip. But history shows us that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips tend to be followed by a long bull run, which eventually overcomes the resistance set by the market’s previous highest price. This is evident not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in the last few years. With more and more companies and industries adopting it, its usage and acceptance is growing. From banking to gaming the use of crypto is increasing in many ways. And this growing use case can lead to more people being involved in the crypto market and, in turn, drive the prices up.
The rise in interest of institutions in cryptocurrency
In the last few years, we’ve seen a growing interest from institutional investors in cryptocurrency. From hedge funds to banks numerous large institutions are now exploring the possibilities in crypto currencies. The increasing interest from institutions could provide more stability to the crypto market and result in greater prices.
As the crypto market is maturing as it matures, governments all over the world are beginning to establish more favorable rules for crypto. This could help attract more investors and boost the mainstream adoption of crypto.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrency, blockchain, offers a variety of possible applications 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 benefit from blockchain technology. This could stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas such as security and scalability, potential of cryptocurrency assets will continue to expand. This could result in more use and increase in prices.
Rising global economic uncertainty
With the ongoing 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 investments like bitcoin and even gold. Because the global economic climate is uncertain, this could lead to increased demand for crypto and more expensive prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in ones showing interest in cryptocurrency. Retail investors, or individual investors, are also starting to participate in the cryptocurrency market. In the future, as more everyday people learn about crypto and how to invest in it, this could lead to more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market is maturing as more and more people are starting to learn about and appreciate it. As the awareness and acceptance grows of crypto it could result in increasing numbers of people purchasing and holding crypto, which can raise prices.
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Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market that allows finance services built on top of blockchain technology. As DeFi continues to grow and more platforms and projects come online, this could lead to increased adoption and more expensive prices for crypto.
The development of crypto payment methods
As the crypto market grows, more and more companies are starting accepting crypto payments as a form of payment. This could lead to increased use of crypto in regular transactions and higher prices.
The increased investment of sovereign wealth funds
These funds are government-owned investments, are starting to look at crypto as a potential asset class. As more funds dedicate a part of their assets to digital currencies, this could lead to increased demand and higher prices.
Use of crypto for international payments
One of the main advantages of crypto is the capability to perform swift and affordable cross-border transactions. As more and more people and businesses are beginning to make use of cryptocurrency for international transactions it could result in increased the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
As the number of crypto ATM’s increase it will be more convenient for consumers to purchase and keep crypto, which could boost demand and increase prices.
Development of security tokens
Security tokens, also known as digital assets that represent ownership in an asset such as real estate or stock are rapidly expanding sector of the crypto market. As more security tokens are issued and traded, this could result in a rise in demand and higher prices for crypto.
More adoption by merchants
With the increasing number of retailers begin accepting crypto as a means of payment, this will make it more convenient for people to utilize and store crypto, which can increase demand and price.
Will crypto be on the rise in 2023? The only way to know is time. With these things in mind, it’s possible that the cryptocurrency market will be able to see a rebound in 2023. For those committed to the long-term patience and discipline is crucial.