It’s been a rough experience for the crypto market through 2022. As of November the market had dropped by more than 70 percent from its previous high at the end of November. And just when things were going downhill after the FTX crash turned things even worse. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had its fair share of dips in the past. And every time, it’s rebounded by a massive rise.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for over a year, reaching a low of $150. However, in 2017, it broke the record, and hit a new record high of $19,600. Then, in 2018, the price was at $3,100. And in 2020, it broke that resistance and reached a new high of $68,000 in November 2021. Then, just like that we’ve had another dip. But history shows us that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs are typically followed by a long bull run that finally surpasses the resistance created by the previous high price. This is evident in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in the last few years. With more and more businesses and industries adopting it, its usage and acceptance is growing. From gaming to finance cryptocurrency is being utilized in a variety of ways. And this growing use case could result in increasing participation in the crypto market and, in turn, drive the prices up.
The rise in interest of institutions in crypto
In the last few years we’ve witnessed a rising curiosity from institutions investing in crypto. From hedge funds to banks and even large corporations are beginning to investigate the possibilities of crypto assets. The increased interest of institutions could bring more stability to the market for crypto and could lead to higher prices.
Regulations from the Government
As the crypto market is maturing as it matures, governments all over the world are beginning to establish more favorable rules for crypto. This could help attract more investors as well as increase the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that underlies many cryptocurrency, blockchain, offers a variety of potential use cases beyond just financial transactions. From supply chain management to voting systems, more industries are exploring ways they can benefit from blockchain technology. This will drive more investment and interest in crypto.
Advancements in technology
Crypto and blockchain technology 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 acceptance and higher prices.
Rising global economic uncertainty
With the ongoing instability in the economy caused through the COVID-19 pandemic and other factors, more and more investors are beginning to look for safe haven assets such as cryptocurrency and gold. Because the global economic climate remains uncertain, this could lead to more demand for crypto as well as increased prices.
Interest from retail investors
The institutional investors aren’t alone in people who are interested in cryptocurrency. Retail investors, or individual investors, are also starting to get involved in the crypto market. With increasing numbers of people learn about cryptocurrency and investing in it This could result in an increase in demand and consequently higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto is maturing as more and more people are beginning to become aware about and understand it. As the awareness and acceptance grows of crypto it could result in increasing numbers of people purchasing and holding crypto, which can increase prices.
crypto summit 2018
Decentralized finance (DeFi) is an emerging area of the crypto market that enables the provision of financial services created on top of blockchain technology. As DeFi expands and more platforms and projects are launched, it could lead to increased adoption and higher prices for crypto.
Developments in crypto payment methods
As the market for crypto continues to grow, more and more companies are beginning to accept crypto as a means of payment. This could lead to increased usage of crypto in daily transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are state-owned instruments for investing, are now beginning to show interest in cryptocurrency as a possible asset class. As more of these funds allocate a portion of their portfolio to crypto, this could increase demand and higher prices.
Utilization of crypto to make international payments
One of the main advantages of crypto is its ability to facilitate swift and affordable cross-border transactions. As more businesses and individuals begin to use crypto for international transactions, this can lead to a rise in demand and higher costs.
The number of ATMs that accept crypto is increasing.
With the amount of crypto ATM’s increase it will be more convenient for people to buy and keep crypto, which will drive up demand and prices.
Security tokens are developed for development
Security tokens, also known as digital assets that are used to represent ownership of an asset, like stock or real estate are rapidly expanding segment of the cryptocurrency market. As more security tokens are created and traded, it can lead to a higher demand and higher rates for the crypto.
More adoption by merchants
In the event that more businesses begin accepting crypto as a form of payment, this makes it easier for customers to utilize and store cryptocurrency, which will boost demand and increase prices.
So, will crypto increase in 2023? The only way to know is time. However, with these aspects being considered, it’s possible that the crypto market could be able to see a rebound in 2023. If you’re in it for the long run, being patient and disciplined is crucial.