It’s been a rough ride for the crypto market through 2022. In November, the market had dipped by 70 percent from the previous high on November 20, 2021. And just when things were looking down, the FTX crash made them look more dire. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had its fair share of dips over the years. And every time, it has bounced back by a massive rally.
In 2013, for instance, 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 new highest of $19,600. Fast forward to 2018, it was trading at $3,100. In 2020, it broke that resistance and reached a new peak of $68,000 in the month of November 2021. Then, just like that we’ve had another dip. However, history has shown us that at the end of every dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen previously, dips tend to be followed by a prolonged bull run that eventually breaks through the resistance created by the previous market’s highest price. This pattern is evident in more than Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have progressed a lot in the last few years. With more and more companies and industries embracing it, its usage and acceptance is increasing. From gaming to finance cryptocurrency is being utilized in a myriad of ways. The growing popularity of crypto can lead to increasing participation in the crypto market which could increase the price.
Increased institutional interest in cryptocurrency
In the last few years we’ve witnessed a rising interest from institutional investors in cryptocurrency. From banks to hedge funds, many large institutions are starting to explore the potential for crypto-based assets. The increased interest of institutions can bring stability to the market for crypto and lead to greater prices.
Regulations of the government
As the market for crypto continues to mature and mature, governments across the globe are starting to create more favorable regulations for crypto. This could help attract more investors as well as increase the acceptance of crypto in general.
A broader range of blockchain applications
The technology that is the basis of the majority of cryptocurrencies, blockchain is a broad range of potential use cases that go beyond financial transactions. For example, from supply chain management and voting, many companies are beginning to look at ways they can utilize blockchain technology. This could stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the beginning stages of development. As advances continue to be made in areas like security and scalability, potential of cryptocurrency assets will continue to grow. This could lead to greater use and increase in prices.
Global economic uncertainty is growing
Due to the constant instability in the economy caused by the COVID-19 pandemic, as well as other causes many investors are starting to look for safe haven assets such as gold and crypto. Because the global economic climate is uncertain it could result in increased demand for crypto and increased prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only ones showing interest in cryptocurrency. Retail investors, or even individual investors are also beginning to invest in the crypto market. As more and more everyday people are educated about crypto and the best ways to invest in it This could result in increased demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto grows, more and more people are beginning to become aware about it and comprehend the concept. As understanding and acceptance of cryptocurrency grows, it will lead to increasing numbers of people purchasing and holding crypto, which can increase prices.
crypto tuesday
Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market that allows the provision of financial services created using blockchain technology. As DeFi grows and more platforms and projects come online, this could lead to increased adoption and increased prices for crypto.
Developments in crypto payment methods
As the market for crypto grows, more and more companies are starting to accept crypto as a means of payment. This could result in increased use of crypto in everyday transactions and higher prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned investment vehicles, are starting to show interest in crypto as an asset class. As more funds allocate a portion of their portfolio to crypto, it could result in a rise in demand and increased prices.
Cryptocurrency is used for cross-border payments
One of the biggest benefits of crypto is its capability to perform swift and affordable cross-border transactions. As more businesses and individuals begin to use cryptocurrency for international transactions this could lead to increased demand and higher prices.
An increasing number of crypto ATM’s
The number of crypto ATM’s increase it will be more convenient for individuals to purchase and hold cryptocurrency, which can boost demand and increase prices.
The development of security tokens
Security tokens, which are digital assets that are used to represent ownership of an asset, such as stock or real estate, are a rapidly growing segment of the cryptocurrency market. With the increasing number of security tokens being created and traded, it could result in a rise in demand and higher costs for cryptocurrency.
Merchants are more likely to adopt the concept.
With the increasing number of merchants start accepting crypto as a means of payment, it will make it easier for people to use and hold crypto, which can boost demand and increase prices.
Will crypto be on the grow in 2023? It’s only time to find out. With these things to consider, it’s possible that the cryptocurrency market will be able to see a rebound in 2023. And for those who are committed to the long-term, being patient and disciplined will be key.