It’s been a rough experience for the crypto market in 2022. By November the market was down by more than 70 percent from the previous high on November 20, 2021. Just when the market was getting worse after the FTX crash turned things even more dire. What is the likelihood that the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced its fair share of drops in the past. And every time, it’s bounced back with a huge rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for more than a year before reaching a bottom of $150. However, in 2017, it broke that record and reached a new high of $19,600. Fast forward to 2018, and it was trading at $3,100. In 2020, the price broke through that resistance and reached a new peak of $68,000 in the month of November 2021. Just like that, we’ve seen 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
As we’ve seen in the past, dips are usually followed by a prolonged bull run that finally breaks through the resistance created by the market’s previous highest price. This pattern can be seen not only in Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in recent years. With more and more companies and industries taking to it, its usage and acceptance is increasing. From finance to gaming the use of crypto is increasing in a myriad of ways. The growing popularity of crypto could lead to increasing participation in the crypto market, which in turn could boost prices.
Increased institutional interest in crypto
In recent years we’ve noticed a growing interest from institutional investors in crypto. From hedge funds to banks and even large corporations are beginning to investigate the possibilities of crypto assets. This increased interest from institutions could provide more stability to the market for crypto and result in greater prices.
Regulations of the government
As the crypto market continues to mature and mature, governments across the globe are starting to create more favorable rules for cryptocurrency. This is likely to attract more investors and boost the mainstream adoption of crypto.
Blockchain has many more applications.
The underlying technology behind many cryptocurrencies, blockchain, is a broad range of applications that go beyond the realm of financial transactions. From supply chain management to voting systems, more industries are exploring ways they can benefit from blockchain technology. This could drive more investment and interest in crypto.
Advancements in technology
Blockchain technology and cryptography are still in the beginning stages of development. As advances continue to be made in areas like security and scalability, the potential of crypto assets will increase. This could lead to greater use and increase in prices.
Uncertainty in the global economy
In the current economic uncertainty brought on by the COVID-19 pandemic, as well as other causes many investors are starting to look for safe haven investments like cryptocurrency and gold. Because the global economic climate remains uncertain and uncertain, this could lead to increased demand for crypto and increased prices.
Retail investors are able to earn interest
Institutional investors aren’t the only ones showing interest in crypto. Retail investors, or individual investors are also beginning to invest in the cryptocurrency market. With increasing numbers of everyday people learn about crypto and the best ways to invest in it, this could lead to more demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the crypto market grows as more and more people are beginning to learn about it and comprehend it. As the awareness and acceptance of cryptocurrency grows, it will lead to increasing numbers of people purchasing and holding crypto, which can drive up prices.
crypto object is instantiated
The Decentralized Finance (DeFi) is an emerging area of the crypto market, which allows financial services to be created upon blockchain technology. As DeFi continues to grow and more projects and platforms are launched, it could lead to increased adoption and more expensive prices for crypto.
Developments in crypto payment methods
As the market for crypto grows as more and more businesses are beginning accepting crypto payments as a form of payment. This could lead to an increase in the 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 investment vehicles, are now beginning to show interest in cryptocurrency as a possible asset class. As more of these funds dedicate a part of their assets to digital currencies, it could result in a rise in demand and increased prices.
Use of crypto for payment across borders
One of the biggest benefits of cryptocurrency is its ability to make quick and inexpensive cross-border payments. As more and more people and businesses begin to use cryptocurrency for international transactions, this can lead to a rise in demand and higher costs.
An increasing number of crypto ATM’s
As the number of crypto ATM’s continue to increase it will be more convenient for consumers to purchase and store cryptocurrency, which can increase demand and price.
The development of security tokens
Security tokens, also known as digital assets that represent ownership of an asset, like stocks or real estate, are a rapidly growing sector of the crypto market. As more security tokens are issued and traded, it could lead to increased demand, and thus higher prices for crypto.
More adoption by merchants
With the increasing number of merchants accept crypto as a means of payment, it will make it easier for consumers to hold and use crypto, which can drive up demand and prices.
So, is crypto likely to grow in 2023? It’s only time to find out. With these things to consider, it’s possible that the cryptocurrency market will see a recovery in 2023. If you’re committed to the long run Being patient and disciplined is essential.