It’s been a rough journey for the cryptocurrency market until 2022. By November the market was down by 70 percent from the previous high in November 2021. When things were looking down and down, the FTX crash made them look worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has experienced its fair share of dips over the years. Every time, it’s bounced back by a massive rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for more than a year, reaching a low of $150. But, in 2017 it broke that record and reached a new highest of $19,600. 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. Just like that, we’ve had another dip. But history shows us that following each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
As we’ve seen before, fall-offs are typically followed by a long bull run, which eventually surpasses the resistance created by the previous high price. This pattern can be seen not only in Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in the last few years. With more and more companies and industries taking to it, its usage and acceptance is increasing. From finance to gaming, crypto is being used in a variety of ways. This growing demand could result in more people getting involved in the market, which in turn could increase the price.
A rise in the interest of institutions for crypto
In recent years, we’ve seen a growing curiosity from institutions investing in cryptocurrency. From banks to hedge funds and even large corporations are starting to explore the possibilities in crypto currencies. The increased interest of institutions could bring more stability to the market for crypto and lead to higher prices.
Regulations from the Government
As the market for crypto is maturing and mature, governments across the globe are starting to create more favorable regulations for cryptocurrency. This will help draw 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 offers a variety of potential use cases 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 drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is still in the beginning stages of development. As progress is made in areas like security and scalability, potential of crypto assets will grow. This could result in more acceptance and higher prices.
Rising global economic uncertainty
In the current instability in the economy caused by the COVID-19 pandemic and other factors many investors are starting to look for safe haven investments like gold and crypto. As the global economic situation is uncertain, this could lead to more demand for crypto as well as more expensive prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only one who’s showing an interest in crypto. Retail investors, or even individual investors, are also starting to get involved in the market for crypto. In the future, as more people learn about crypto and how to invest in it This could result in more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market continues to mature as more and more people are beginning to learn about and appreciate it. As understanding and acceptance of cryptocurrency grows, it will lead to more people buying and holding crypto, which can increase prices.
crypto lending platform development
The Decentralized Finance (DeFi) is an emerging area of the crypto market, which allows financial services to be built on top of blockchain technology. As DeFi expands and more projects and platforms come online, this could result in increased use and higher prices for crypto.
Developments in crypto payment methods
As the market for crypto is growing, more and more companies are beginning using crypto to be a form of payment. This could lead to increased use of crypto in regular transactions, and a rise in prices.
More investment from sovereign wealth funds
These funds are government-owned investments, are starting to look at crypto as a potential asset class. As more funds allocate a portion or their entire portfolios to cryptocurrency, this could increase demand and higher prices.
Use of crypto for payment across borders
One of the main advantages of crypto is its ability to facilitate fast and cheap cross-border payments. As more individuals and businesses begin to use cryptocurrency for international transactions, it could result in increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
As the number of crypto ATM’s continue to increase it will be more convenient for people to buy and hold crypto, which will drive up demand and prices.
The development of security tokens
Security tokens, or digital assets that are used to represent ownership of an asset, such as stocks or real estate, are a rapidly growing area of the crypto market. Since more and more security tokens will be created and traded, this can lead to a higher demand and higher rates for the crypto.
More adoption by merchants
With the increasing number of retailers accept cryptocurrency as a method of payment, this will make it easier for people to hold and use cryptocurrency, which will boost demand and increase prices.
Will crypto be on the grow in 2023? Only time will tell. With these things to consider, it’s possible that the cryptocurrency market will see a recovery in 2023. For those committed to the long-term patience and discipline will be key.