It’s been a rough ride for the crypto market through 2022. In November the market had dropped by 70 percent from its previous high on November 20, 2021. Just when the market was going downhill after the FTX crash made them look even worse. What is the likelihood that the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen its fair share of drops in the past. And every time, it has bounced back with a huge rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year, reaching a low of $150. However, in 2017, it broke that record and reached a new highest of $19,600. In 2018, the price was at $3,100. In the year 2020 it struck through that resistance and hit 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, there’s a bull run.
Every Dip is Followed by a Long Bull Run
As we’ve seen before, fall-offs are typically followed by a prolonged bull run, which eventually surpasses the resistance created by the previous high price. This pattern can be seen not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in the last few years. With more and better companies and industries taking to the technology, its use and acceptance is growing. From banking to gaming cryptocurrency is being utilized in a variety of ways. And this growing use case can lead to more people getting involved in the market, which in turn could increase the price.
Increased institutional interest in crypto
In recent years we’ve noticed a growing interest from institutional investors in crypto. From banks to hedge funds numerous large institutions are now exploring the possibilities for crypto-based assets. This increased interest from institutions could bring more stability to the crypto market and lead to 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 cryptocurrency. This could help attract more investors and boost the acceptance of crypto in general.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrency, blockchain, is a broad range of possible applications beyond the realm of financial transactions. For example, from supply chain management and voting, many companies are starting to explore how they can make use of blockchain technology, which could increase investment and enthusiasm in crypto.
Advancements in technology
Blockchain and cryptocurrency technology is at the very beginning of development. As advances continue to be made in areas such as scalability and security, the potential of crypto assets will expand. This could lead to greater adoption and higher prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty caused through the COVID-19 pandemic, as well as other causes, more and more investors are starting to look for safe haven investments like bitcoin and even gold. As the global economic situation remains uncertain it could result in increased demand for crypto and increased 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 starting to participate in the crypto market. With increasing numbers of people learn about crypto and the best ways to invest in it, this could lead to increased demand and higher prices.
The growing awareness and acceptance of crypto
As the market for crypto continues to mature, more and more people are beginning to become aware about it and comprehend it. As understanding and acceptance grows of crypto, this could lead to increasing numbers of people purchasing or holding cryptocurrency, and this could increase prices.
eoa crypto
The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market, which allows finance services built using blockchain technology. As DeFi grows and more platforms and projects come online, this could result in increased use and more expensive prices for crypto.
Developments in crypto payment methods
As the crypto market grows increasing numbers of companies are starting accepting crypto payments as a method of payment. This could result in increased usage of crypto in daily transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
Sovereign wealth funds, which are government-owned investments, are beginning to look at crypto as a potential asset class. As more of these funds dedicate a part or their entire portfolios to cryptocurrency, this could increase demand and increased prices.
Utilization of crypto to make international payments
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 begin to use cryptocurrency for international transactions it could result in increased the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
As the number of ATMs that accept crypto increase it will be easier for individuals to purchase and store crypto, which could boost demand and increase prices.
The development of security tokens
Security tokens, or digital assets that signify ownership in an asset like real estate or stock is a fast-growing sector of the crypto market. As more security tokens are issued and traded, this could result in a rise in demand and consequently higher prices for crypto.
More adoption by merchants
As more and more merchants start accepting crypto as a form of payment, it makes it easier for customers to utilize and store crypto, which could increase demand and price.
So, is crypto likely to rise in 2023? The only way to know is time. But with these factors in mind, it’s likely that the cryptocurrency market will have a rebound by 2023. If you’re in it for the long haul Being patient and disciplined is crucial.