It’s been a tough journey for the cryptocurrency market until 2022. By November the market had dropped by more than 70 percent from the previous high in November 2021. When things were going downhill after the FTX crash turned things more dire. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen its fair share of dips in the past. Each time, it has bounced back with a big rally.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for a full year before hitting a low of $150. But, in 2017, it broke the record, and hit a new highest of $19,600. In 2018, it was trading at $3,100. In the year 2020 it struck through that resistance, and reached a record high of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. 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 previously, dips tend to be followed by a prolonged bull run, which eventually breaks through the resistance created by the market’s previous highest price. This pattern can be seen in not just Bitcoin but also 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 increasing. From finance to gaming cryptocurrency is being utilized in many ways. The growing popularity of crypto could lead to more people getting involved in the market, which in turn could drive the prices up.
The rise in interest of institutions in cryptocurrency
In recent times, we’ve seen a growing demand from investors of institutional scale in cryptocurrency. From banks to hedge funds and even large corporations are starting to explore the possibilities for crypto-based assets. The increasing interest from 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 as it matures, governments all over the world are beginning to establish more favorable rules for cryptocurrency. This is likely to attract more investors as well as increase the mainstream adoption of crypto.
More use cases for blockchain
The underlying technology behind many cryptocurrencies, blockchain, offers a variety of possible applications that go beyond financial transactions. For example, from supply chain management and voting, many and more industries are beginning to look at ways they can utilize blockchain technology. This will stimulate more investment and excitement in crypto.
Blockchain technology and cryptography are at the very beginning of development. As advancements continue to be made in areas like scalability and security, the potential of crypto assets will continue to grow. This could lead to greater adoption and higher prices.
Global economic uncertainty is growing
Due to the constant economic uncertainty brought on due to the COVID-19 pandemic and other factors many investors are starting to look for safe haven assets like cryptocurrency and gold. Because the global economic climate remains uncertain, this could lead to more demand for crypto as well as more expensive prices.
Retail investors are able to earn interest
Institutional investors aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, also known as individual investors, are also starting to invest in the market for crypto. With increasing numbers of people learn about cryptocurrency and investing in it this could result in 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 learn about and appreciate the concept. As the awareness and acceptance of cryptocurrency grows it could result in more people buying or holding cryptocurrency, and this can increase prices.
earn crypto currency
The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market that allows finance services developed upon blockchain technology. As DeFi continues to grow and more projects and platforms come online, this could lead to increased adoption and higher prices for crypto.
The development of crypto payment methods
As the crypto market grows as more and more businesses are beginning to accept crypto as a method of payment. This could lead to an increase in the usage of crypto in daily transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are government-owned instruments for investing, are now beginning to show interest in crypto as an asset class. As more funds devote a percentage of their portfolio to crypto, it could lead to increased demand and increased prices.
Use of crypto for international payments
One of the biggest benefits of crypto is the capability to perform fast and cheap cross-border payments. As more individuals and businesses are beginning to make use of cryptocurrency for international transactions, this can lead to a rise in demand and higher costs.
An increasing number of crypto ATM’s
The number of ATMs that accept crypto continue to increase, it will become easier for consumers to purchase and hold crypto, which will drive up demand and prices.
Security tokens are developed for development
Security tokens, which are digital assets that represent ownership of an asset, like real estate or stock, are a rapidly growing sector of the crypto market. Since more and more security tokens will be issued and traded, it could lead to increased demand, and thus higher rates for the crypto.
A greater adoption rate by merchants
As more and more merchants start accepting crypto as a form of payment, it will make it more convenient for customers to hold and use crypto, which could drive up demand and prices.
So, will crypto increase in 2023? Only time will tell. However, with these aspects in mind, it’s possible that the crypto market will have a rebound by 2023. And for those who are committed to the long-term, being patient and disciplined is crucial.