It’s been a tough experience for the crypto market in 2022. As of November, the market had dipped by more than 70 percent from the previous high on November 20, 2021. Just when the market was going downhill, the FTX crash turned things more dire. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced its fair share of dips over the years. And every time, it has bounced back by a massive rally.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for more than a year before hitting a low of $150. In 2017 it broke that record, and hit a new high of $19,600. Then, in 2018, the price was at $3,100. In 2020, it broke through that resistance and reached a new high of $68,000 in November 2021. 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 tend to be followed by a long bull run that finally overcomes the resistance set by the previous high price. This pattern can be seen in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in recent years. With more and better companies and industries embracing the technology, its use and acceptance is increasing. From banking to gaming the use of crypto is increasing in a variety of ways. The growing popularity of crypto can lead to increasing participation in the crypto market which could drive the prices up.
Increased institutional interest in crypto
In recent times we’ve noticed a growing interest from institutional investors in cryptocurrency. From banks to hedge funds numerous large institutions are now exploring the possibilities in crypto currencies. This increased interest from institutions could provide more stability to the crypto market and lead to higher prices.
As the market for crypto continues to mature, governments around the world are starting to create more favorable regulations for crypto. This will help draw more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The technology that underlies the majority of cryptocurrencies, blockchain is a broad range of applications that go beyond the realm of financial transactions. In addition to supply chain management, voting and other systems companies are starting to explore how they can make use of blockchain technology. This will increase investment and enthusiasm in crypto.
Crypto and blockchain technology are at the very beginning of development. As advances continue to be made in areas such as scalability and security, the potential of cryptocurrency assets will continue to grow. This could lead to greater adoption and higher prices.
Global economic uncertainty is growing
With the ongoing instability in the economy caused by the COVID-19 pandemic and other factors many investors are beginning to look for safe haven investments like gold and crypto. Because the global economic climate is uncertain and uncertain, this could lead to increased demand for crypto and increased prices.
Interest from retail investors
The institutional investors aren’t alone in one who’s showing an interest in crypto. Retail investors, also known as individual investors are also beginning to invest in the cryptocurrency market. With increasing numbers of people learn about crypto and the best ways to invest in it this could result in more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto is maturing, more and more people are beginning to learn about it and comprehend it. As awareness and acceptance grows of crypto it could result in more people buying and holding crypto, which can increase prices.
The Decentralized Finance (DeFi) is an emerging area of the crypto market, which allows the provision of financial services developed using blockchain technology. As DeFi continues to grow and more projects and platforms become available, this will lead to a rise in adoption and increased prices for crypto.
Developments in crypto payment methods
As the crypto market continues to grow increasing numbers of companies are starting using crypto to be a method of payment. This could lead to increased use of crypto in regular transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are government-owned investments, are now beginning to look at cryptocurrency as a possible asset class. As more of these funds allocate a portion of their portfolio to crypto, it could result in a rise in demand and more expensive prices.
Utilization of crypto to make cross-border payments
One of the major benefits of cryptocurrency is its ability to facilitate quick and inexpensive cross-border payments. As more individuals and businesses are beginning to make use of cryptocurrency for international transactions, it could result in increased demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of ATMs for crypto continue to increase it will be more convenient for individuals to purchase and keep crypto, which will drive up demand and prices.
Security tokens are developed for development
Security tokens, also known as digital assets that signify ownership of an asset, such as stock or real estate is a fast-growing area of the crypto market. With the increasing number of security tokens being issued and traded, it could lead to increased demand, and thus higher rates for the crypto.
Merchants are more likely to adopt the concept.
With the increasing number of businesses start accepting cryptocurrency as a method of payment, it will make it more convenient for customers to utilize and store cryptocurrency, which will increase demand and price.
Will crypto be on the rise in 2023? Only time will tell. But with these factors in mind, it’s likely that the crypto market could see a recovery in 2023. If you’re in it for the long run patience and discipline will be key.