It’s been a difficult journey for the cryptocurrency market through 2022. As of November the market had dropped by more than 70% from its previous peak in November 2021. Just when the market was going downhill, the FTX crash turned things even more dire. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many dips in the past. And every time, it has bounced back by a massive increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for a full year before hitting a low of $150. In 2017, it broke the record, and hit a new highest of $19,600. Then, in 2018, the price was at $3,100. In the year 2020 it struck through that resistance and hit a new peak of $68,000 in the month of November 2021. Then, just like that we’ve seen another dip. But history shows 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 before, fall-offs tend to be followed by a prolonged bull run, which eventually overcomes the resistance set by the previous high price. This pattern is evident 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 more companies and industries embracing the technology, its use and acceptance is increasing. From banking to gaming cryptocurrency is being utilized in a myriad of ways. The growing popularity of crypto could result in more people getting involved in the crypto market, which in turn could drive the prices up.
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 beginning to investigate the possibilities in crypto currencies. The increasing interest from institutions can bring stability to the crypto market and result in greater prices.
Regulations of the government
As the market for crypto continues to mature and mature, governments across the globe are starting to create more favorable rules for crypto. This is likely to attract more investors and increase the adoption rate of crypto.
A broader range of blockchain applications
The technology that underlies many cryptocurrency, blockchain, has a wide range of applications that go beyond the realm of financial transactions. From supply chain management to voting systems, more industries are exploring ways they can utilize blockchain technology. This will stimulate more investment and excitement in crypto.
Technology advancements
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 cryptocurrency assets will continue to grow. This could result in more adoption and higher prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty brought on by the COVID-19 pandemic and other factors increasing numbers of investors are starting to look for safe haven assets such as gold and crypto. Because the global economic climate remains uncertain it could result in 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 invest in the market for crypto. In the future, as more everyday people learn about crypto and how to invest in it, this could lead to more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto grows, more and more people are starting to learn about and understand it. As understanding and acceptance grows of crypto, this could lead to more people buying and holding crypto, which could drive up prices.
faze banks crypto wallet
The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market that allows financial services to be created upon blockchain technology. As DeFi continues to grow and more platforms and projects are launched, it will lead to a rise in adoption and higher prices for crypto.
The development of crypto payment methods
As the crypto market grows as more and more businesses are beginning accepting crypto payments as a means of payment. This could result in increased use of crypto in regular transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
The sovereign wealth fund, also known as state-owned instruments for investing, are now beginning to explore crypto as a potential asset class. As more funds dedicate a part of their assets to digital currencies, this could result in a rise in demand and higher prices.
Utilization of crypto to make cross-border payments
One of the biggest benefits of crypto is the capability to perform quick and inexpensive cross-border payments. As more individuals and businesses start to utilize crypto for international transactions, it could result in increased the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
As the number of ATMs for crypto continue to grow, it will become easier for people to buy and keep crypto, which will increase demand and price.
Security tokens are developed for development
Security tokens, or digital assets that represent ownership of an asset, like real estate or stock are rapidly expanding segment of the cryptocurrency market. As more security tokens are issued and traded, this could result in a rise in demand and higher rates for the crypto.
A greater adoption rate by merchants
As more and more businesses accept crypto as a form of payment, this will make it easier for people to hold and use cryptocurrency, which will boost demand and increase prices.
Will crypto be on the rise in 2023? It’s only time to find out. But with these factors to consider, it’s possible that the crypto market will have a rebound by 2023. If you’re looking to invest for the long haul Being patient and disciplined is crucial.