It’s been a difficult journey for the cryptocurrency market until 2022. By November, the market had dipped by more than 70 percent from the previous high in November 2021. When things were looking down, the FTX crash turned things even more dire. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has experienced many dips over the years. And every time, it’s bounced back with a huge rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year before hitting a low of $150. In 2017 it broke that record, and hit a new high of $19,600. Fast forward to 2018, it was trading at $3,100. And in 2020, it broke through the resistance and reached a new peak of $68,000 in the month of November 2021. And just like that, we’ve had 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 before, fall-offs are typically followed by a prolonged bull run that finally overcomes the resistance set by the previous market’s highest price. This pattern can be seen in not just Bitcoin but also other cryptocurrencies.
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 taking to the technology, its use and acceptance is rising. From finance to gaming the use of crypto is increasing in a variety of ways. And this growing use case could lead to increasing participation in the market and, in turn, increase the price.
A rise in the interest of institutions for crypto
In recent years we’ve noticed a growing curiosity from institutions investing in crypto. From banks to hedge funds and even large corporations are beginning to investigate the potential in crypto currencies. This increased interest from institutions could bring more stability to the market for crypto and lead to greater prices.
Regulations of the government
As the market for crypto is maturing and mature, governments across the globe are starting to create more favorable regulations for crypto. This is likely to attract more investors and boost the mainstream adoption of crypto.
A broader range of blockchain applications
The technology that is the basis of the majority of cryptocurrencies, blockchain is a broad range of possible applications that go beyond financial transactions. From supply chain management to voting systems, more and more industries are exploring ways they can make use of blockchain technology. This could stimulate more investment and excitement in crypto.
Crypto and blockchain technology are still in the early stages of development. As progress is made in areas such as security and scalability, the potential of crypto assets will continue to increase. This could result in more use and increase in prices.
Rising global economic uncertainty
Due to the constant instability in the economy caused due to the COVID-19 pandemic and other factors, more and more investors are looking for safe haven assets like bitcoin and even gold. Because the global economic climate is uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only ones showing interest in crypto. Retail investors, or individual investors, are also starting to get involved in the market for crypto. As more and more everyday people become aware of cryptocurrency and investing in it, this could lead to increased demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto grows as more and more people are beginning to become aware about and appreciate the concept. As awareness and acceptance of cryptocurrency grows, it will lead to more people purchasing and holding crypto, which could raise prices.
Decentralized finance (DeFi) is a rapidly growing area of the crypto market, which allows financial services to be developed on top of blockchain technology. As DeFi expands and more projects and platforms come online, this could lead to increased adoption and more expensive prices for crypto.
The development of crypto payment methods
As the market for crypto is growing increasing numbers of companies are beginning accepting crypto payments as a means of payment. This could lead to increased use of crypto in everyday transactions and higher prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned instruments for investing, are now beginning to show interest in crypto as an asset class. As more of these funds dedicate a part of their portfolio to crypto, it could lead to increased demand and higher prices.
Utilization of crypto to make cross-border payments
One of the main advantages of crypto is its ability to facilitate swift and affordable cross-border transactions. As more and more people and businesses start to utilize cryptocurrency for international transactions, this could lead to increased demand and higher costs.
The number of ATMs that accept crypto is increasing.
The number of crypto ATM’s increase it will be easier for people to buy and keep crypto, which could increase demand and price.
Security tokens are developed for development
Security tokens, also known as digital assets that represent ownership in an asset such as stock or real estate is a fast-growing sector of the crypto market. With the increasing number of security tokens being issued and traded, it could lead to increased demand, and thus higher rates for the crypto.
A greater adoption rate by merchants
With the increasing number of merchants start accepting crypto as a means of payment, it will make it easier for consumers to use and hold cryptocurrency, which will increase demand and price.
Will crypto be on the increase in 2023? Only time will tell. But with these factors in mind, it’s likely that the crypto market could have a rebound by 2023. For those in it for the long haul patience and discipline will be key.