It’s been a tough journey for the cryptocurrency market through 2022. As of November the market was down by 70 percent from the previous high at the end of November. When things were going downhill and down, the FTX crash made them look even worse. What is the likelihood that the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen many drops in the past. Each time, it has bounced back with a big increase.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for over a year before reaching a bottom of $150. In 2017, it broke that record and reached a new high of $19,600. Then, in 2018, the price was at $3,100. In the year 2020 it struck through the resistance and reached a new peak of $68,000 in the month of November 2021. Just like that, we’ve had another dip. However, history has shown us that after 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, which eventually surpasses the resistance created by the market’s previous highest price. This pattern can be seen in more than 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 embracing it, its usage and acceptance is growing. From finance to gaming, crypto is being used in a variety of ways. And this growing use case can lead to increasing participation in the market and, in turn, drive the prices up.
A rise in the interest of institutions for crypto
In the last few years we’ve witnessed a rising interest from institutional investors in cryptocurrency. From banks to hedge funds and even large corporations are now exploring the possibilities in crypto currencies. The increased interest of institutions could provide more stability to the market for crypto and could lead to higher prices.
As the crypto market grows as it matures, governments all over the world are beginning to establish more favorable rules for cryptocurrency. This could help attract more investors and increase the mainstream adoption of crypto.
A broader range of blockchain applications
The technology that underlies many cryptocurrencies, blockchain, has a wide range of applications that go beyond just financial transactions. From supply chain management to voting systems, more industries are beginning to look at ways they can make use of blockchain technology. This could increase investment and enthusiasm in cryptocurrency.
Crypto and blockchain technology are still in the early stages of development. As advances continue to be made in areas like security and scalability, the potential of crypto assets will continue to increase. This could result in more acceptance and higher prices.
Global economic uncertainty is growing
Due to the constant economic uncertainty brought on by the COVID-19 pandemic as well as other factors many investors are starting to look for safe haven assets such as cryptocurrency and gold. Because the global economic climate remains uncertain and uncertain, this could lead to an increase in demand for crypto and more expensive prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in ones showing interest in cryptocurrency. Retail investors, also known as individual investors are also beginning to participate in the cryptocurrency market. With increasing numbers of everyday people become aware of crypto and the best ways to invest in it This could result in an increase in demand and consequently higher prices.
The growing awareness and acceptance of crypto
As the market for crypto grows increasing numbers of people are starting to learn about and understand the concept. As awareness and acceptance of cryptocurrency grows, this could lead to more people purchasing and holding crypto, which can increase prices.
Decentralized finance (DeFi) is a rapidly growing area of the crypto market that enables finance services built upon blockchain technology. As DeFi grows and more platforms and projects come online, this will lead to a rise in adoption and more expensive prices for crypto.
Developments in crypto payment methods
As the market for crypto is growing as more and more businesses are starting to accept crypto as a means of payment. This could result in increased usage of crypto in daily transactions, and a rise in prices.
The increased investment of sovereign wealth funds
Sovereign wealth funds, which are government-owned investment vehicles, are now beginning to show interest in cryptocurrency as a possible asset class. As more funds devote a percentage of their assets to digital currencies, it could increase demand and higher prices.
Cryptocurrency is used for international payments
One of the main advantages of crypto is its capability to perform fast and cheap cross-border payments. As more businesses and individuals begin to use cryptocurrency for international transactions this can lead to a rise in demand and higher prices.
Increasing numbers of crypto ATM’s
The number of ATMs for crypto increase, it will become easier for consumers to purchase and hold cryptocurrency, which can boost demand and increase prices.
The development of security tokens
Security tokens, also known as digital assets that represent ownership of an asset, like real estate or stock, are a rapidly growing sector of the crypto market. With the increasing number of security tokens being created and traded, it could lead to increased demand and consequently higher costs for cryptocurrency.
More adoption by merchants
In the event that more businesses start accepting crypto as a means of payment, it will make it easier for consumers to use and hold cryptocurrency, which will increase demand and price.
Will crypto be on the rise in 2023? Only time will tell. But with these factors in mind, it’s likely that the crypto market could see a recovery in 2023. And for those who are in it for the long run Being patient and disciplined is crucial.