It’s been a tough ride for the crypto market through 2022. As of November the market had dropped by 70% from its previous peak at the end of November. Just when the market was getting worse, the FTX crash made them look more dire. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had many drops in the past. Each time, it has bounced back by a massive rally.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for more than a year, reaching a low of $150. But, in 2017 it broke that record and hit a record highest of $19,600. Then, in 2018, the price was at $3,100. In 2020, it broke through that resistance and hit a new high of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. But history shows us that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
As we’ve seen in the past, dips are typically followed by a long bull run that eventually surpasses the resistance created by the market’s previous highest price. This pattern is evident in more than Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in recent years. With more and more companies and industries embracing it, its usage and acceptance is rising. From gaming to finance, crypto is being used in a myriad of ways. And this growing use case could lead to more people getting involved in the crypto market which could boost prices.
A rise in the interest of institutions for cryptocurrency
In recent times, we’ve seen a growing interest from institutional investors in crypto. From hedge funds to banks numerous large institutions are now exploring the possibilities for crypto-based assets. This increased interest from institutions could provide more stability to the crypto market and lead to more expensive prices.
Regulations from the Government
As the market for crypto continues to mature as it matures, governments all over the world are starting to create more favorable rules for crypto. This could help attract more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The technology that is the basis of many cryptocurrencies, blockchain, is a broad range of possible applications beyond just financial transactions. In addition to supply chain management, voting and other systems and more industries are beginning to look at ways they can benefit from blockchain technology, which could stimulate more investment and excitement 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 such as scalability and security, the potential of crypto assets will continue to grow. This could lead to more acceptance and higher prices.
Uncertainty in the global economy
In the current economic uncertainty caused by the COVID-19 pandemic, as well as other causes, more and more investors are beginning to look for safe haven investments like cryptocurrency and gold. Since the economic outlook for the world is uncertain, this could lead to increased demand for crypto and more expensive prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in one who’s showing an interest in cryptocurrency. Retail investors, or individual investors, are also starting to get involved in the market for crypto. As more and more everyday people are educated about cryptocurrency and investing in it this could result in increased demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto is maturing, more and more people are beginning to become aware about and understand the concept. As understanding and acceptance grows of crypto, this could lead to more people buying or holding cryptocurrency, and this could raise prices.
crypto valentines card
The Decentralized Finance (DeFi) is an emerging area of the crypto market that allows finance services created on top of blockchain technology. As DeFi grows and more projects and platforms come online, this will lead to a rise in adoption and increased prices for crypto.
The development of crypto payment methods
As the market for crypto grows, more and more companies are beginning accepting crypto payments as a form of payment. This could result in increased use of crypto in everyday transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as owned by the state as investment vehicles, are beginning to look at crypto as an asset class. As more of these funds dedicate a part of their portfolio to crypto, this could lead to increased demand and more expensive prices.
Use of crypto for cross-border payments
One of the biggest benefits of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more businesses and individuals begin to use crypto for international transactions, this could lead to increased demand and higher costs.
An increasing number of crypto ATM’s
With the amount of crypto ATM’s continue to increase it will be easier for people to buy and keep cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, or digital assets that are used to represent ownership in an asset such as stocks or real estate is a fast-growing sector of the crypto market. With the increasing number of security tokens being created and traded, this could lead to increased demand and consequently higher rates for the crypto.
More adoption by merchants
As more and more merchants accept crypto as a means of payment, it will make it easier for consumers to use and hold crypto, which can drive up demand and prices.
So, will crypto rise in 2023? It’s only time to find out. However, with these aspects being considered, it’s likely that the crypto market will be able to see a rebound in 2023. If you’re in it for the long-term patience and discipline will be key.