It’s been a tough ride for the crypto market until 2022. As of November the market had dropped by 70 percent from its previous high in November 2021. When things were going downhill after the FTX crash turned things 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. Every time, it has bounced back by a massive rally.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for a full year, reaching a low of $150. In 2017, it broke the record, and hit a new high of $19,600. Fast forward to 2018, it was trading at $3,100. In the year 2020 it struck through that resistance, and reached a record peak of $68,000 in the month of November 2021. Then, just like that we’ve seen another dip. However, history has shown us that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips are typically followed by a prolonged bull run, which eventually surpasses the resistance created by the previous high price. This is evident not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have progressed a lot in recent years. With more and better companies and industries adopting it, its usage and acceptance is growing. From gaming to finance the use of crypto is increasing in many ways. And this growing use case could lead to more people being involved in the market which could drive the prices up.
A rise in the interest of institutions for crypto
In recent years we’ve noticed a growing interest from institutional investors in crypto. From banks to hedge funds, many large institutions are beginning to investigate the possibilities for crypto-based assets. The increased interest of institutions can bring stability to the market for crypto and lead to more expensive prices.
As the crypto market is maturing and mature, governments across the globe are beginning to establish more favorable rules for cryptocurrency. This will help draw more investors and boost the mainstream adoption of crypto.
More use cases for blockchain
The technology that is the basis of many cryptocurrencies, blockchain, has a wide range of possible applications beyond just financial transactions. For example, from supply chain management and voting, many companies are beginning to look at ways they can benefit from blockchain technology. This could drive more investment and interest in cryptocurrency.
Advancements in technology
Blockchain technology and cryptography are at the very beginning of development. As advances continue to be made in areas such as security and scalability, potential of crypto assets will continue to increase. This could lead to more use and increase in prices.
Uncertainty in the global economy
With the ongoing economic uncertainty brought on through the COVID-19 pandemic as well as other factors many 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 an increase in demand for crypto and more expensive prices.
Interest from retail investors
The institutional investors aren’t alone in one who’s showing an interest in cryptocurrency. Retail investors, or individual investors, are also starting to participate in the market for crypto. As more and more people become aware of crypto and how to invest in it This could result in increased demand and higher prices.
Growing awareness and acceptance of crypto
As the market for crypto grows as more and more people are beginning to learn about and appreciate it. As understanding and acceptance of crypto grows, this could lead to more people buying or holding cryptocurrency, and this could increase prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market that enables financial services to be built using blockchain technology. As DeFi grows and more projects and platforms become available, this could lead to increased adoption and increased prices for crypto.
Developments in crypto payment methods
As the market for crypto grows increasing numbers of companies are starting using crypto to be a form of payment. This could lead to increased use of crypto in everyday transactions and higher prices.
More investment from sovereign wealth funds
Sovereign wealth funds, which are government-owned investment vehicles, are beginning to look at crypto as a potential asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, it could lead to increased demand and more expensive prices.
Use of crypto for payment across borders
One of the biggest benefits of crypto is its ability to make fast and cheap cross-border payments. As more individuals and businesses begin to use cryptocurrency for international transactions this could lead to increased demand and higher costs.
An increasing number of crypto ATM’s
The number of ATMs for crypto increase it will be easier for consumers to purchase and keep cryptocurrency, which can drive up demand and prices.
The development of security tokens
Security tokens, which are digital assets that represent ownership in an asset like stocks or real estate, are a rapidly growing sector of the crypto market. As more security tokens are created and traded, it could lead to increased demand and consequently higher rates for the crypto.
Merchants are more likely to adopt the concept.
In the event that more businesses accept crypto as a form of payment, it will make it more convenient for customers to use and hold crypto, which can boost demand and increase prices.
Will crypto be on the grow in 2023? The only way to know is time. With these things to consider, it’s likely that the crypto market could be able to see a rebound in 2023. And for those who are committed to the long run patience and discipline will be key.