It’s been a difficult experience for the crypto market in 2022. In November the market was down by more than 70% from its previous peak in November 2021. And just when things were looking down and down, the FTX crash made them look even more dire. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had many dips in the past. Each time, it has bounced back by a massive increase.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year before reaching a bottom of $150. In 2017 it broke that record and hit a record highest of $19,600. In 2018, it was trading at $3,100. And in 2020, it broke that resistance and reached a new highest of $68,000 in November 2021. Then, just like that we’ve seen another dip. However, history has shown us that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
As we’ve seen before, fall-offs are typically followed by a prolonged bull run that eventually breaks through the resistance created by the market’s previous highest price. This pattern can be seen not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in recent years. With more and more businesses and industries embracing the technology, its use and acceptance is increasing. From finance to gaming cryptocurrency is being utilized in many ways. And this growing use case could result in increasing participation in the crypto market and, in turn, increase the price.
The rise in interest of institutions in crypto
In recent times we’ve witnessed a rising curiosity from institutions investing in crypto. From hedge funds to banks, many large institutions are beginning to investigate the possibilities for crypto-based assets. This increased interest from institutions could bring more stability to the crypto market and result in more expensive prices.
Regulations of the government
As the crypto market is maturing, governments around the world are starting to create more favorable rules for crypto. This could help attract more investors and boost the mainstream adoption of crypto.
Blockchain has many more applications.
The underlying technology behind the majority of cryptocurrencies, blockchain has a wide 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 make use of blockchain technology, which could stimulate more investment and excitement in crypto.
Advancements in technology
Blockchain technology and cryptography are at the very beginning of development. As advancements continue to be made in areas such as security and scalability, potential of cryptocurrency assets will continue to increase. This could lead to greater acceptance and higher prices.
Rising global economic uncertainty
With the ongoing economic uncertainty caused through the COVID-19 pandemic, as well as other causes increasing numbers of investors are looking for safe haven investments like bitcoin and even gold. As the global economic situation remains uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in people who are interested in cryptocurrency. Retail investors, also known as individual investors, are also starting to get involved in the market for crypto. In the future, as more people become aware of cryptocurrency and investing in it This could result in an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting crypto
As the crypto market continues to mature increasing numbers of people are beginning to become aware about it and comprehend it. As the awareness and acceptance of crypto grows, it will lead to more people purchasing or holding cryptocurrency, and this could drive up prices.
The Decentralized Finance (DeFi) is an emerging area of the crypto market that allows finance services developed using blockchain technology. As DeFi expands and more projects and platforms become available, this could result in increased use and higher prices for crypto.
The development of crypto payment methods
As the market for crypto is growing as more and more businesses are beginning to accept crypto as a means of payment. This could lead to increased use of crypto in everyday transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
These funds are government-owned instruments for investing, are starting to look at cryptocurrency as a possible asset class. As more funds dedicate a part or their entire portfolios to cryptocurrency, this could lead to increased demand and more expensive prices.
Cryptocurrency is used for payment across borders
One of the main advantages of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more and more people and businesses are beginning to make use of crypto for international transactions, it could result in increased demand and higher costs.
The number of ATMs that accept crypto is increasing.
With the amount of crypto ATM’s increase, it will become easier for consumers to purchase and store crypto, which could boost demand and increase prices.
Development of security tokens
Security tokens, also known as digital assets that are used to represent ownership in an asset like stock or real estate is a fast-growing segment of the cryptocurrency market. As more security tokens are issued and traded, it could result in a rise in demand and higher costs for cryptocurrency.
A greater adoption rate by merchants
With the increasing number of merchants start accepting cryptocurrency as a method of payment, this will make it easier for people to use and hold 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 to consider, it’s likely that the crypto market could have a rebound by 2023. For those committed to the long-term Being patient and disciplined is crucial.