It’s been a rough ride for the crypto market until 2022. In November the market was down by more than 70 percent from the previous high at the end of November. Just when the market was getting worse after the FTX crash turned them even worse. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen its fair share of dips over the years. Every time, it’s bounced back by a massive increase.
For instance, in 2013, Bitcoin reached a peak of $1,160, then fell for over a year before reaching a bottom of $150. In 2017, it broke the record and hit a record record high of $19,600. Fast forward to 2018, it was trading at $3,100. And in 2020, it broke that resistance, and reached a record peak of $68,000 in the month of November 2021. Then, just like that we’ve seen another dip. However, the past has proven that following each 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 usually followed by a long bull run that eventually surpasses the resistance created by the previous high price. This is evident in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in the last few years. With more and more businesses and industries taking to the technology, its use and acceptance is growing. From banking to gaming the use of crypto is increasing in a variety of ways. This growing demand could lead to more people getting involved in the market and, in turn, drive the prices up.
Increased institutional interest in crypto
In recent years we’ve witnessed a rising curiosity from institutions investing in crypto. From hedge funds to banks, many large institutions are beginning to investigate the potential in crypto currencies. The increasing interest from institutions could bring more 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 crypto. This is likely to attract more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The technology that is the basis of many cryptocurrency, blockchain, has a wide range of potential use cases that go beyond financial transactions. In addition to supply chain management, voting and other systems and more industries are exploring ways they can utilize blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Blockchain and cryptocurrency technology is still in the early stages of development. As progress is made in areas like scalability and security, the potential of crypto assets will continue to expand. This could lead to greater acceptance and higher prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty brought on due to the COVID-19 pandemic as well as other factors many investors are looking for safe haven investments like cryptocurrency and gold. Because the global economic climate is uncertain, this could lead to an increase in demand for crypto and increased prices.
Interest from retail investors
The institutional investors aren’t alone in ones showing interest in crypto. Retail investors, also known as individual investors are also beginning to get involved in the crypto market. As more and more people are educated about crypto and the best ways to invest 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 cryptocurrency
As the crypto market continues to mature, more and more people are starting to learn about and understand it. As understanding and acceptance of crypto grows it could result in more people buying as well as holding the crypto that can drive up prices.
emily yang crypto
The Decentralized Finance (DeFi) is an emerging area of the crypto market that allows the provision of financial services built using blockchain technology. As DeFi grows and more platforms and projects are launched, it will lead to a rise in adoption and more expensive prices for crypto.
Advances in crypto-based payment methods
As the crypto market grows, more and more companies are starting to accept crypto as a means of payment. This could lead to increased use of crypto in regular transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
Sovereign wealth funds, which are government-owned instruments for investing, are now beginning to explore crypto as an asset class. As more of these funds dedicate a part of their assets to digital currencies, this could lead to increased demand and increased prices.
Cryptocurrency is used for international payments
One of the major benefits of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more businesses and individuals begin to use cryptocurrency for international transactions, this could lead to increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
The number of ATMs for crypto continue to grow it will be easier for individuals to purchase and hold crypto, which could increase demand and price.
The development of security tokens
Security tokens, also known as digital assets that represent ownership in an asset like stock or real estate are rapidly expanding sector of the crypto market. As more security tokens are created and traded, it could result in a rise in demand and consequently higher costs for cryptocurrency.
A greater adoption rate by merchants
With the increasing number of retailers accept crypto as a form of payment, this makes it easier for people to use and hold cryptocurrency, which will increase demand and price.
Will crypto be on the grow in 2023? Only time will tell. However, with these aspects in mind, it’s possible that the crypto market could have a rebound by 2023. If you’re looking to invest for the long run Being patient and disciplined will be key.