It’s been a tough ride for the crypto market through 2022. As of November, the market had dipped by more than 70% from its previous peak in November 2021. When things were looking down and down, the FTX crash made them look even worse. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced many drops in the past. And every time, it’s rebounded with a huge increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for a full year before reaching a bottom of $150. But, in 2017, it broke the record, and hit a new high of $19,600. In 2018, and it was trading at $3,100. And in the year 2020 it struck through the resistance and reached a new highest of $68,000 in November 2021. Just like that, we’ve seen another dip. However, the past has proven that at the end of every dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
As we’ve seen before, fall-offs tend to be followed by a prolonged bull run, which eventually overcomes the resistance set by the previous market’s highest price. This pattern is evident in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in recent years. With more and more businesses and industries adopting it, its usage and acceptance is growing. From gaming to finance the use of crypto is increasing in a variety of ways. This growing demand could lead to more people being involved in the market, which in turn could increase the price.
Increased institutional interest in crypto
In the last few years we’ve noticed a growing interest from institutional investors in crypto. From hedge funds to banks and even large corporations are now exploring the potential for crypto-based assets. The increased interest of institutions could provide more stability to the market for crypto and could lead to greater prices.
Regulations from the Government
As the crypto market continues to mature and mature, governments across the globe are starting to create more favorable regulations for crypto. This could help attract more investors and increase the acceptance of crypto in general.
Blockchain has many more applications.
The underlying technology behind the majority of cryptocurrencies, blockchain offers a variety of applications that go that go beyond 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. This will increase investment and enthusiasm in crypto.
Blockchain technology and cryptography are at the very beginning of development. As advances continue to be made in areas such as security and scalability, potential of crypto assets will expand. This could lead to greater adoption and higher prices.
Rising global economic uncertainty
In the current instability in the economy caused by the COVID-19 pandemic and other factors many investors are beginning to look for safe haven investments like cryptocurrency and gold. As the global economic situation remains uncertain and uncertain, this could lead to more demand for crypto as well as more expensive prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only ones showing interest in crypto. Retail investors, also known as individual investors are also beginning to invest in the market for crypto. In the future, as more people learn about cryptocurrency and investing in it, this could lead to more demand and higher prices.
The growing awareness and acceptance of crypto
As the market for crypto grows increasing numbers of people are beginning to become aware about it and comprehend it. As awareness and acceptance of crypto grows, it will lead to more people buying or holding cryptocurrency, and this could raise prices.
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Decentralized finance (DeFi) is an emerging area of the crypto market, which allows the provision of financial services developed using blockchain technology. As DeFi expands and more projects and platforms become available, this could result in increased use and more expensive prices for crypto.
Developments in crypto payment methods
As the market for crypto grows, more and more 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 a rise in prices.
The increased investment of sovereign wealth funds
The sovereign wealth fund, also known as state-owned instruments for investing, are starting to look at crypto as an asset class. As more funds dedicate a part or their entire portfolios to cryptocurrency, it could increase demand and higher prices.
Cryptocurrency is used for payment across borders
One of the main advantages of crypto is its capability to perform swift and affordable cross-border transactions. As more individuals and businesses start to utilize cryptocurrency for international transactions this could lead to increased demand and higher costs.
An increasing number of crypto ATM’s
With the amount of ATMs that accept crypto increase it will be more convenient for individuals to purchase and hold crypto, which could boost demand and increase prices.
The development of security tokens
Security tokens, which are digital assets that signify ownership of an asset, such as stock or real estate are rapidly expanding area of the crypto market. Since more and more security tokens will be created and traded, it could lead to increased demand and higher prices for crypto.
A greater adoption rate by merchants
As more and more retailers start accepting crypto as a means of payment, this will make it more convenient for customers to use and hold crypto, which can increase demand and price.
So, will crypto increase in 2023? The only way to know is time. However, with these aspects to consider, it’s possible that the crypto market will see a recovery in 2023. For those committed to the long-term patience and discipline will be key.