It’s been a tough journey for the cryptocurrency market in 2022. As of November the market had dropped by more than 70 percent from the previous high on November 20, 2021. And just when things were getting worse after the FTX crash turned them even more dire. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had its fair share of drops in the past. And every time, it’s rebounded with a big rise.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for over a year, reaching a low of $150. In 2017 it broke that record and hit a record high of $19,600. In 2018, the price was at $3,100. And in 2020, it broke through that resistance and reached a new highest of $68,000 in November 2021. Just like that, we’ve had another dip. However, history has shown us that at the end of every dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen in the past, dips tend to be followed by a prolonged bull run, which eventually breaks through the resistance created by the previous market’s highest price. This is evident not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in the last few years. With more and better companies and industries taking to it, its usage and acceptance is increasing. From gaming to finance, crypto is being used in a variety of ways. The growing popularity of crypto can lead to more people getting involved in the market, which in turn could boost prices.
Increased institutional interest in cryptocurrency
In the last few years we’ve witnessed a rising demand from investors of institutional scale in cryptocurrency. From hedge funds to banks and even large corporations are now exploring the possibilities of crypto assets. The increased interest of institutions could provide more stability to the market for crypto and result in more expensive prices.
Regulations from the Government
As the market for crypto continues to mature and mature, governments across the globe are beginning to establish more favorable regulations for crypto. This could help attract more investors and increase the mainstream adoption of crypto.
A broader range of blockchain applications
The underlying technology behind many cryptocurrency, blockchain, is a broad range of applications that go beyond the realm of financial transactions. From supply chain management to voting systems, more companies are starting to explore how they can utilize blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Blockchain technology and cryptography are at the very beginning of development. As progress is made in areas such as scalability and security, the potential of crypto assets will continue to increase. This could result in more use and increase in prices.
Uncertainty in the global economy
Due to the constant economic uncertainty brought on through the COVID-19 pandemic, as well as other causes many investors are looking for safe haven investments like cryptocurrency and gold. Since the economic outlook for the world 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 people who are interested in cryptocurrency. Retail investors, or even individual investors are also beginning to invest in the market for crypto. As more and more everyday people are educated about cryptocurrency and investing in it this could result in more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market continues to mature, more and more people are starting to learn about it and comprehend it. As the awareness and acceptance of crypto grows, it will lead to more people buying or holding cryptocurrency, and this could drive up prices.
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Decentralized finance (DeFi) is a rapidly growing area of the crypto market that enables financial services to be developed using blockchain technology. As DeFi expands and more platforms and projects come online, this could lead to increased adoption and higher prices for crypto.
The development of crypto payment methods
As the crypto market is growing, more and more companies are starting using crypto to be a form of payment. This could lead to an increase in the usage of crypto in daily transactions and higher prices.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned investment vehicles, are beginning to show interest in cryptocurrency as a possible asset class. As more funds allocate a portion or their entire portfolios to cryptocurrency, this could increase demand and more expensive prices.
Use of crypto for international payments
One of the biggest benefits of crypto is the capability to perform quick and inexpensive cross-border payments. As more and more people and businesses are beginning to make use of cryptocurrency for international transactions, this can lead to a rise in the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
With the amount of crypto ATM’s continue to grow it will be easier for consumers to purchase and keep crypto, which could drive up demand and prices.
Development of security tokens
Security tokens, also known as digital assets that represent ownership in an asset like real estate or stock, are a rapidly growing sector of the crypto market. As more security tokens are created and traded, this could result in a rise in demand and higher rates for the crypto.
Merchants are more likely to adopt the concept.
With the increasing number of merchants start accepting cryptocurrency as a method of payment, this will make it easier for consumers to use and hold crypto, which could increase demand and price.
So, will crypto rise in 2023? It’s only time to find out. However, with these aspects in mind, it’s possible that the crypto market could be able to see a rebound in 2023. And for those who are in it for the long-term patience and discipline is crucial.