It’s been a rough ride for the crypto market until 2022. In 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 more dire. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had many dips over the years. And every time, it has bounced back with a big increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for more than a year before hitting a low of $150. However, in 2017, it broke that record and reached a new record high of $19,600. Fast forward to 2018, and it was trading at $3,100. In the year 2020 it struck through that resistance, and reached a record highest of $68,000 in November 2021. And 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
Similar to what we’ve witnessed previously, dips tend to be followed by a lengthy bull run that eventually overcomes the resistance set by the previous market’s highest price. This pattern can be seen in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in the last few years. With more and more companies and industries adopting it, its usage and acceptance is rising. From finance to gaming, crypto is being used in a variety of ways. And this growing use case could result in more people getting involved in the market and, in turn, boost prices.
The rise in interest of institutions in cryptocurrency
In recent years we’ve witnessed a rising interest from institutional investors in crypto. From banks to hedge funds and even large corporations are now exploring the possibilities in crypto currencies. The increased interest of institutions can bring stability to the crypto market and could lead to greater prices.
Regulations of the government
As the market for crypto is maturing as it matures, governments all over the world are beginning to develop more favorable regulations for cryptocurrency. This is likely to attract more investors and boost the adoption rate of crypto.
Blockchain has many more applications.
The underlying technology behind many cryptocurrency, blockchain, offers a variety of potential use cases that go beyond financial transactions. From supply chain management to voting systems, more and more industries are starting to explore how they can utilize blockchain technology. This could drive more investment and interest in crypto.
Technologies are constantly evolving.
Crypto and blockchain technology are at the very beginning of development. As progress is made in areas such as security and scalability, the potential of crypto assets will continue to expand. This could lead to more use and increase in prices.
Rising global economic uncertainty
With the ongoing economic uncertainty caused through the COVID-19 pandemic, as well as other causes, more and more investors are starting to look for safe haven assets like cryptocurrency and gold. Since the economic outlook for the world is uncertain and uncertain, this could lead to increased demand for crypto and more expensive prices.
Retail investors are able to earn interest
Institutional investors aren’t the only one who’s showing an interest in crypto. Retail investors, or even individual investors, are also starting to participate in the crypto market. With increasing numbers of everyday people become aware of cryptocurrency and investing in it This could result in an increase in demand and consequently higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market is maturing, more and more people are starting to learn about it and comprehend it. As awareness and acceptance of cryptocurrency grows, this could lead to increasing numbers of people purchasing or holding cryptocurrency, and this could drive up prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market, which allows financial services to be created upon blockchain technology. As DeFi expands and more platforms and projects become available, this could result in increased use and more expensive prices for crypto.
The development of crypto payment methods
As the market for crypto continues to grow increasing numbers of companies are beginning to accept crypto as a form of payment. This could lead to an increase in the use of crypto in everyday transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
Sovereign wealth funds, which are government-owned investments, are starting to show interest in crypto as a potential asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, it could result in a rise in demand and higher prices.
Cryptocurrency is used for payment across borders
One of the biggest benefits of cryptocurrency is its ability to make swift and affordable cross-border transactions. As more individuals and businesses are beginning to make use of cryptocurrency for international transactions this can lead to a rise in demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of crypto ATM’s increase it will be easier for people to buy and store cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, or digital assets that signify ownership in an asset like real estate or stock is a fast-growing area of the crypto market. With the increasing number of security tokens being issued and traded, this could result in a rise in demand and higher prices for crypto.
More adoption by merchants
With the increasing number of businesses start accepting crypto as a means of payment, it will make it more convenient for people to utilize and store crypto, which could boost demand and increase prices.
So, will crypto rise in 2023? It’s only time to find out. But with these factors to consider, it’s possible that the cryptocurrency market will be able to see a rebound in 2023. For those committed to the long run, being patient and disciplined is essential.