It’s been a tough experience for the crypto market in 2022. As of November the market was down by more than 70 percent from its previous high on November 20, 2021. When things were getting worse and down, the FTX crash made them look worse. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced many dips over the years. Each time, it has bounced back by a massive increase.
For instance, in 2013, Bitcoin reached a peak of $1,160, then fell for a full year, reaching a low of $150. However, in 2017 it broke that record and reached a new record high of $19,600. Then, in 2018, the price was at $3,100. In the year 2020 it struck through the resistance and reached a new high of $68,000 in November 2021. And just like that, we’ve had another dip. However, the past has proven that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs tend to be followed by a long bull run that eventually surpasses the resistance created by the previous market’s highest price. This pattern can be seen in not just 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 companies and industries adopting the technology, its use and acceptance is rising. From banking to gaming cryptocurrency is being utilized in a myriad of ways. And this growing use case can lead to more people being involved in the market and, in turn, boost prices.
Increased institutional interest in cryptocurrency
In recent years we’ve witnessed a rising interest from institutional investors in crypto. From banks to hedge funds and even large corporations are beginning to investigate the potential in crypto currencies. The increasing interest from institutions can bring stability to the market for crypto and could lead to higher prices.
Regulations of the government
As the crypto market grows, governments around the world are beginning to establish more favorable rules for cryptocurrency. This is likely to attract more investors as well as increase the acceptance of crypto in general.
A broader range of blockchain applications
The underlying technology behind the majority of cryptocurrencies, blockchain offers a variety of potential use cases beyond just financial transactions. In addition to supply chain management, voting and other systems companies are exploring ways they can benefit from blockchain technology. This could stimulate more investment and excitement in cryptocurrency.
Advancements in technology
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas such as security and scalability, the potential of crypto assets will increase. This could lead to greater use and increase in prices.
Global economic uncertainty is growing
Due to the constant instability in the economy caused due to the COVID-19 pandemic as well as other factors, more and more investors are looking for safe haven assets like cryptocurrency and gold. Since the economic outlook for the world is uncertain and uncertain, this could lead to more demand for crypto as well as higher prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only one who’s showing an interest in crypto. Retail investors, or individual investors, are also starting to participate in the market for crypto. As more and more everyday people learn about crypto and how to invest in it This could result in more demand and higher prices.
Growing awareness and acceptance of crypto
As the crypto market grows as more and more people are starting to learn about it and comprehend it. As the awareness and acceptance grows of crypto, it will lead to increasing numbers of people purchasing or holding cryptocurrency, and this could increase prices.
dyfn crypto price
The Decentralized Finance (DeFi) is an emerging area of the crypto market that enables financial services to be created upon blockchain technology. As DeFi expands and more platforms and projects come online, this could lead to increased adoption and higher prices for crypto.
Developments in crypto payment methods
As the crypto market continues to grow, more and more companies are beginning using crypto to be a means of payment. This could result in increased use of crypto in everyday transactions, and a rise in prices.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned instruments for investing, are starting to explore crypto as a potential asset class. As more of these funds dedicate a part of their assets to digital currencies, this could lead to increased demand and more expensive prices.
Cryptocurrency is used for cross-border payments
One of the major benefits of crypto is its capability to perform fast and cheap cross-border payments. As more and more people and businesses begin to use cryptocurrency for international transactions it could result in increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
As the number of ATMs for crypto increase, it will become easier for people to buy and keep crypto, which will boost demand and increase prices.
The development of security tokens
Security tokens, or digital assets that represent ownership in an asset such as real estate or stock are rapidly expanding segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, it could lead to increased demand and higher costs for cryptocurrency.
A greater adoption rate by merchants
In the event that more retailers begin accepting crypto as a means of payment, this makes it easier for consumers to use and hold crypto, which can increase demand and price.
So, is crypto likely to rise in 2023? Only time will tell. With these things in mind, it’s possible that the crypto market could see a recovery in 2023. For those in it for the long haul patience and discipline will be key.