It’s been a rough journey for the cryptocurrency market until 2022. In November the market was down by more than 70% from its previous peak in November 2021. And just when things were going downhill, the FTX crash turned things worse. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced many dips in the past. And every time, it’s bounced back with a big rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for more than a year before reaching a bottom of $150. In 2017, it broke the record and reached a new high of $19,600. Then, in 2018, it was trading at $3,100. And in 2020, it broke through the resistance and reached a new high of $68,000 in November 2021. Just like that, we’ve witnessed another drop. 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 that eventually breaks through the resistance created by the market’s previous highest price. This is evident in not just 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 businesses and industries embracing it, its usage and acceptance is increasing. From finance to gaming, crypto is being used in a variety of ways. And this growing use case could lead to more people getting involved in the market, which in turn could increase the price.
The rise in interest of institutions in cryptocurrency
In the last few years we’ve witnessed a rising demand from investors of institutional scale in crypto. From hedge funds to banks, many large institutions are beginning to investigate the possibilities of crypto assets. The increasing interest from institutions can bring stability to the crypto market and result in greater prices.
Regulations from the Government
As the market for crypto continues to mature, governments around the world are beginning to develop more favorable regulations for cryptocurrency. This will help draw more investors and boost the adoption rate of crypto.
More use cases for blockchain
The technology that is the basis of many cryptocurrencies, blockchain, is a broad range of applications that go beyond the realm of financial transactions. In addition to supply chain management, voting and other systems and more industries are starting to explore how they can make use of blockchain technology, which could stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas like security and scalability, potential of cryptocurrency assets will continue to expand. This could lead to greater adoption and higher prices.
Uncertainty in the global economy
In the current instability in the economy caused through the COVID-19 pandemic as well as other factors, more and more investors are looking for safe haven investments like cryptocurrency and gold. As the global economic situation remains uncertain and uncertain, this could lead to increased demand for crypto and increased prices.
Interest from retail investors
The institutional investors aren’t alone in ones showing interest in cryptocurrency. Retail investors, or individual investors are also beginning to participate in the cryptocurrency market. With increasing numbers of everyday people become aware of crypto and how to invest in it this could result in an increase in demand and consequently higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto grows increasing numbers of people are starting to learn about and understand the concept. As the awareness and acceptance of crypto grows, it will lead to more people buying or holding cryptocurrency, and this could increase prices.
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The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market, which allows the provision of financial services built using blockchain technology. As DeFi grows and more projects and platforms become available, this will lead to a rise in adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the market for crypto is growing as more and more businesses are beginning to accept crypto as a form of payment. This could result in increased use of crypto in everyday transactions, and a rise in prices.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are owned by the state as investments, are starting to look at cryptocurrency as a possible asset class. As more of these funds devote a percentage or their entire portfolios to cryptocurrency, this could lead to increased demand and increased prices.
Utilization of crypto to make international payments
One of the major benefits of crypto is its ability to facilitate swift and affordable cross-border transactions. As more businesses and individuals start to utilize cryptocurrency for international transactions this could lead to increased the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
The number of crypto ATM’s increase it will be more convenient for individuals to purchase and keep crypto, which will boost demand and increase prices.
The development of security tokens
Security tokens, which are digital assets that signify ownership in an asset like stocks or real estate are rapidly expanding sector of the crypto market. As more security tokens are issued and traded, this could lead to increased demand and higher costs for cryptocurrency.
Merchants are more likely to adopt the concept.
With the increasing number of businesses accept crypto as a means of payment, it will make it more convenient for customers to utilize and store crypto, which can boost demand and increase prices.
Will crypto be on the increase in 2023? The only way to know is time. With these things being considered, it’s likely that the cryptocurrency market will have a rebound by 2023. If you’re committed to the long haul Being patient and disciplined is crucial.