It’s been a difficult experience for the crypto market until 2022. By November the market had dropped by 70 percent from the previous high at the end of November. And just when things were getting worse and down, the FTX crash turned things even more dire. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen its fair share of dips over the years. Every time, it’s bounced back by a massive rally.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year before hitting a low of $150. In 2017, it broke the record and hit a record record high of $19,600. Fast forward to 2018, the price was at $3,100. In 2020, it broke through the resistance and reached a new high of $68,000 in November 2021. Just like that, we’ve witnessed another drop. However, history has shown us that after each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen in the past, dips are usually followed by a long bull run, which eventually surpasses the resistance created by the market’s previous highest price. This is evident not only in 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 taking to it, its usage and acceptance is growing. From banking to gaming, crypto is being used in many ways. This growing demand can lead to more people being involved in the market which could boost prices.
A rise in the interest of institutions for crypto
In the last few years, we’ve seen a growing curiosity from institutions investing in cryptocurrency. From banks to hedge funds numerous large institutions are now exploring the possibilities of crypto assets. This increased interest from institutions could bring more stability to the market for crypto and lead to greater prices.
As the market for crypto grows and mature, governments across the globe are starting to create more favorable rules for crypto. This is likely to attract more investors and increase the adoption rate of crypto.
A broader range of blockchain applications
The technology that underlies many cryptocurrencies, blockchain, is a broad range of applications that go that go beyond financial transactions. In addition to supply chain management, voting and other systems companies are beginning to look at ways they can benefit from blockchain technology. This will drive more investment and interest in crypto.
Technologies are constantly evolving.
Crypto and blockchain technology are still in the beginning stages of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will expand. This could lead to more acceptance and higher prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty brought on through the COVID-19 pandemic as well as other factors increasing numbers of investors are beginning to look for safe haven assets such as gold and crypto. Since the economic outlook for the world is uncertain it could result in increased demand for crypto and increased prices.
Interest from retail investors
Institutional investors aren’t the only one who’s showing an interest in crypto. Retail investors, also known as individual investors, are also starting to get involved in the crypto market. With increasing numbers of everyday people become aware of crypto and the best ways to invest in it This could result in more demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the market for crypto grows increasing numbers of people are beginning to become aware about and understand it. As awareness and acceptance of cryptocurrency grows it could result in more people buying and holding crypto, which could increase prices.
Financial decentralization (DeFi) is an emerging area of the crypto market, which allows the provision of financial services created on top of blockchain technology. As DeFi expands and more platforms and projects become available, this will lead to a rise in adoption and higher prices for crypto.
The development of crypto payment methods
As the market for crypto continues to grow, more and more companies are starting to accept crypto as a method of payment. This could result in increased use of crypto in regular transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
Sovereign wealth funds, which are state-owned investment vehicles, are now beginning to show interest in crypto as an asset class. As more of these funds devote a percentage of their assets to digital currencies, this could increase demand and higher prices.
Utilization of crypto to make international payments
One of the biggest benefits of crypto is the capability to perform quick and inexpensive cross-border payments. As more businesses and individuals start to utilize cryptocurrency for international transactions this could lead to increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
The number of ATMs that accept crypto continue to grow it will be more convenient for people to buy and hold crypto, which will boost demand and increase prices.
Security tokens are developed for development
Security tokens, or digital assets that signify ownership in an asset such as real estate or stock is a fast-growing area of the crypto market. As more security tokens are created and traded, it can lead to a higher demand and higher prices for crypto.
A greater adoption rate by merchants
As more and more retailers start accepting crypto as a form of payment, it makes it easier for consumers to hold and use cryptocurrency, which will boost demand and increase prices.
Will crypto be on the increase in 2023? It’s only time to find out. However, with these aspects to consider, it’s possible that the cryptocurrency market will be able to see a rebound in 2023. If you’re committed to the long run, being patient and disciplined is essential.