It’s been a difficult journey for the cryptocurrency market in 2022. By November, the market had dipped by 70 percent from the previous high in November 2021. Just when the market was going downhill and down, the FTX crash turned things even worse. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced its fair share of dips over the years. And every time, it’s rebounded with a huge rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for a full year before hitting a low of $150. In 2017, it broke the record, and hit a new record high of $19,600. In 2018, and it was trading at $3,100. In 2020, it broke that resistance and hit a new peak of $68,000 in the month of November 2021. Then, just like that we’ve had another dip. However, the past has proven that following each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen previously, dips are typically followed by a prolonged bull run that finally overcomes the resistance set by the market’s previous highest price. This is evident not only in Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in recent years. With more and better companies and industries taking to it, its usage and acceptance is growing. From gaming to finance the use of crypto is increasing in many ways. The growing popularity of crypto could result in increasing participation in the market, which in turn could increase the price.
The rise in interest of institutions in crypto
In recent times we’ve witnessed a rising interest from institutional investors in crypto. From hedge funds to banks and even large corporations are beginning to investigate the potential of crypto assets. This increased interest from institutions could provide more stability to the market for crypto and could lead to greater prices.
Regulations of the government
As the market for crypto is maturing, governments around the world are beginning to develop more favorable rules for crypto. This will help draw more investors and increase the adoption rate of crypto.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrency, blockchain, has a wide range of potential use cases that go beyond financial transactions. In addition to supply chain management, voting and other systems companies are beginning to look at ways they can utilize blockchain technology, which could drive more investment and interest in crypto.
Advancements in technology
Blockchain technology and cryptography are still in the early stages of development. As advances continue to be made in areas such as scalability and security, the potential of crypto assets will grow. This could result in more use and increase in prices.
Global economic uncertainty is growing
In the current economic uncertainty caused by the COVID-19 pandemic as well as other factors many investors are beginning to look for safe haven investments like gold and crypto. As the global economic situation remains uncertain it could result in more demand for crypto as well as increased prices.
Retail investors are able to earn interest
Institutional investors aren’t the only one who’s showing an interest in crypto. Retail investors, or individual investors are also beginning to invest in the market for crypto. As more and more everyday people become aware of crypto and how to invest in it This could result in more demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the market for crypto is maturing, more and more people are beginning to learn about and understand it. As the awareness and acceptance of cryptocurrency grows it could result in more people purchasing as well as holding the crypto that could increase prices.
crypto mobile app development
Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market, which allows finance services built using blockchain technology. As DeFi continues to grow and more platforms and projects become available, this will lead to a rise in adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the crypto market grows increasing numbers of companies are beginning using crypto to be a means of payment. This could result in increased use of crypto in everyday transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
Sovereign wealth funds, which are owned by the state as investment vehicles, are beginning to show interest in cryptocurrency as a possible asset class. As more funds allocate a portion of their portfolio to crypto, it could result in a rise in demand and higher prices.
Utilization of crypto to make international payments
One of the main advantages of cryptocurrency is its ability to facilitate fast and cheap cross-border payments. As more individuals and businesses are beginning to make use of cryptocurrency for international transactions this could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of crypto ATM’s continue to grow it will be easier for individuals to purchase and hold crypto, which will boost demand and increase prices.
The development of security tokens
Security tokens, or digital assets that are used to represent ownership in an asset like stocks or real estate is a fast-growing sector of the crypto market. Since more and more security tokens will be created and traded, this could lead to increased demand and higher rates for the crypto.
Merchants are more likely to adopt the concept.
As more and more merchants start accepting cryptocurrency as a method of payment, it makes it easier for consumers to use and hold crypto, which could drive up demand and prices.
Will crypto be on the rise in 2023? Only time will tell. However, with these aspects being considered, it’s possible that the crypto market will be able to see a rebound in 2023. If you’re in it for the long haul, being patient and disciplined is essential.