It’s been a tough ride for the crypto market through 2022. By November the market had dropped by 70 percent from the previous high on November 20, 2021. Just when the market was getting worse after the FTX crash turned them even worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen its fair share of dips in the past. And every time, it has bounced back with a big rally.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for more than a year, reaching a low of $150. But, in 2017, it broke that record, and hit a new high of $19,600. In 2018, the price was at $3,100. And in the year 2020 it struck that resistance, and reached a record highest of $68,000 in 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
Similar to what we’ve witnessed before, fall-offs are typically followed by a prolonged bull run that eventually surpasses the resistance created by the previous market’s highest price. This is evident in more than Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in the last few years. With more and more businesses and industries embracing the technology, its use and acceptance is rising. From gaming to finance the use of crypto is increasing in a myriad of ways. The growing popularity of crypto could lead to more people getting involved in the crypto market which could boost prices.
A rise in the interest of institutions for crypto
In recent years, we’ve seen a growing interest from institutional investors in cryptocurrency. From hedge funds to banks numerous large institutions are starting to explore the possibilities in crypto currencies. The increased interest of institutions could bring more stability to the crypto market and result in higher prices.
Regulations from the Government
As the market for crypto is maturing and mature, governments across the globe are beginning to establish more favorable rules for crypto. This is likely to attract more investors and boost the mainstream adoption of crypto.
Blockchain has many more applications.
The underlying technology behind many cryptocurrency, blockchain, is a broad range of applications that go beyond the realm of financial transactions. In addition to supply chain management, voting and other systems and more industries are starting to explore how they can make use of blockchain technology. This could drive more investment and interest in crypto.
Advancements in technology
Blockchain and cryptocurrency technology is still in the beginning stages of development. As progress is made in areas such as security and scalability, the potential of crypto assets will grow. This could lead to greater adoption and higher prices.
Global economic uncertainty is growing
Due to the constant economic uncertainty brought on by the COVID-19 pandemic and other factors many investors are looking for safe haven investments like gold and crypto. Since the economic outlook for the world remains uncertain and uncertain, this could lead to increased demand for crypto and increased prices.
Interest from retail investors
The institutional investors aren’t alone in ones showing interest in cryptocurrency. Retail investors, also known as individual investors, are also starting to participate in the market for crypto. In the future, as more people become aware of cryptocurrency and investing in it this could result in an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting crypto
As the crypto market continues to mature, more and more people are beginning to learn about and appreciate the concept. As the awareness and acceptance grows of crypto it could result in more people buying and holding crypto, which can increase prices.
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Decentralized finance (DeFi) is a rapidly growing area of the crypto market that enables financial services to be developed upon blockchain technology. As DeFi continues to grow and more platforms and projects are launched, it could result in increased use and increased prices for crypto.
The development of crypto payment methods
As the market for crypto continues to grow as more and more businesses are beginning using crypto to be a means of payment. This could result in increased use of crypto in regular transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are government-owned instruments for investing, are starting to show interest in cryptocurrency as a possible asset class. As more of these funds allocate a portion of their assets to digital currencies, it could result in a rise in demand and more expensive prices.
Utilization of crypto to make payment across borders
One of the major benefits of cryptocurrency is its ability to facilitate fast and cheap cross-border payments. As more and more people and businesses are beginning to make use of cryptocurrency for international transactions, this could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
The number of ATMs that accept crypto continue to increase, it will become easier for consumers to purchase and store cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, also known as digital assets that signify ownership of an asset, like stocks or real estate are rapidly expanding sector of the crypto market. As more security tokens are created and traded, this could lead to increased demand and higher prices for crypto.
Merchants are more likely to adopt the concept.
In the event that more merchants accept cryptocurrency as a method of payment, this will make it easier for consumers to utilize and store crypto, which could increase demand and price.
Will crypto be on the increase in 2023? It’s only time to find out. But with these factors to consider, it’s likely that the crypto market could be able to see a rebound in 2023. If you’re committed to the long run, being patient and disciplined will be key.