It’s been a tough ride for the crypto market until 2022. In November the market was down by more than 70% from its previous peak on November 20, 2021. Just when the market was looking down and down, the FTX crash made them look even more dire. What is the likelihood that the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen 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. It then plummeted for over a year before reaching a bottom of $150. However, in 2017, it broke the record, and hit a new record high of $19,600. In 2018, it was trading at $3,100. In 2020, it broke through that resistance, and reached a record highest of $68,000 in November 2021. Just like that, we’ve had another dip. However, history has shown us that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs are usually followed by a prolonged bull run, which eventually overcomes the resistance set 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
Crypto and blockchain technology have come a long way in the last few years. With more and more companies and industries taking to it, its usage and acceptance is rising. From finance to gaming, crypto is being used in a variety of ways. The growing popularity of crypto can lead to more people getting involved in the crypto market and, in turn, drive the prices up.
A rise in the interest of institutions for cryptocurrency
In recent years, we’ve seen a growing curiosity from institutions investing in cryptocurrency. From banks to hedge funds numerous large institutions are beginning to investigate the possibilities for crypto-based assets. The increased interest of institutions could bring more stability to the crypto market and could lead to higher prices.
Regulations from the Government
As the market for crypto continues to mature, governments around the world are beginning to establish more favorable regulations for crypto. This could help attract more investors as well as increase the mainstream adoption of crypto.
Blockchain has many more applications.
The underlying technology behind many cryptocurrency, blockchain, is a broad range of possible applications beyond just financial transactions. In addition to supply chain management, voting and other systems companies are beginning to look at ways they can benefit from blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Crypto and blockchain technology are still in the beginning stages of development. As progress is made in areas like scalability and security, the potential of crypto assets will increase. This could lead to more acceptance and higher prices.
Global economic uncertainty is growing
With the ongoing instability in the economy caused through the COVID-19 pandemic, as well as other causes increasing numbers of investors are looking for safe haven investments like cryptocurrency and gold. As the global economic situation is uncertain and uncertain, this could lead to more demand for crypto as well as higher prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in one who’s showing an interest in crypto. Retail investors, or even individual investors are also beginning to get involved in the crypto market. In the future, as more 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 grows, more and more people are beginning to learn about it and comprehend the concept. As awareness and acceptance of crypto grows, it will lead to more people buying as well as holding the crypto that could increase prices.
early bird crypto
The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market, which allows finance services built upon blockchain technology. As DeFi expands and more platforms and projects come online, this will lead to a rise in adoption and higher prices for crypto.
Developments in crypto payment methods
As the market for crypto continues to grow, more and more companies are beginning using crypto to be a form of payment. This could result in increased use of crypto in regular transactions and higher prices.
More investment from sovereign wealth funds
These funds are government-owned instruments for investing, are beginning to explore cryptocurrency as a possible asset class. As more of these funds devote a percentage of their portfolio to crypto, it could increase demand and more expensive prices.
Cryptocurrency is used for cross-border payments
One of the main advantages of crypto is its ability to make fast and cheap cross-border payments. As more and more people and businesses are beginning to make use of crypto 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 crypto ATM’s increase, it will become easier for consumers to purchase and hold cryptocurrency, which can increase demand and price.
Development of security tokens
Security tokens, or digital assets that signify ownership in an asset such as stocks or real estate are rapidly expanding sector of the crypto market. With the increasing number of security tokens being created and traded, it could lead to increased demand and consequently higher rates for the crypto.
More adoption by merchants
With the increasing number of businesses begin accepting crypto as a means of payment, it makes it easier for people to hold and use crypto, which could boost demand and increase prices.
Will crypto be on the grow in 2023? The only way to know is time. However, with these aspects in mind, it’s possible that the crypto market could be able to see a rebound in 2023. For those looking to invest for the long-term patience and discipline is crucial.