It’s been a tough experience for the crypto market through 2022. As of November the market was down by more than 70 percent from its previous high at the end of November. Just when the market was looking down, the FTX crash made them look even worse. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced many dips in the past. Each time, it’s rebounded with a big rise.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for over a year, reaching a low of $150. However, in 2017, it broke that record and hit a record highest of $19,600. In 2018, the price was at $3,100. In the year 2020 it struck through the resistance and hit a new peak of $68,000 in the month of November 2021. Just like that, we’ve had another dip. But history shows us that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs are typically followed by a long bull run that eventually surpasses the resistance created by the previous high price. This pattern can be seen in more than Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have progressed a lot in recent years. With more and more companies and industries embracing the technology, its use and acceptance is increasing. From gaming to finance the use of crypto is increasing in a variety of ways. The growing popularity of crypto can lead to more people being involved in the crypto market which could drive the prices up.
A rise in the interest of institutions for crypto
In recent times, we’ve seen a growing curiosity from institutions investing in cryptocurrency. From banks to hedge funds and even large corporations are now exploring the potential for crypto-based assets. The increasing interest from institutions could provide more stability to the crypto market and lead to greater prices.
Regulations of the government
As the market for crypto is maturing and mature, governments across the globe are beginning to develop more favorable rules for cryptocurrency. This is likely to attract more investors and boost the acceptance of crypto in general.
A broader range of blockchain applications
The technology that underlies many cryptocurrency, blockchain, offers a variety of possible applications beyond the realm of financial transactions. In addition to supply chain management, voting and other systems and more industries are starting to explore how they can benefit from blockchain technology. This will stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is at the very beginning of development. As advances continue to be made in areas like security and scalability, the potential of crypto assets will expand. This could result in more acceptance and higher prices.
Uncertainty in the global economy
Due to the constant economic uncertainty caused due to the COVID-19 pandemic, as well as other causes increasing numbers of investors are looking for safe haven assets such as cryptocurrency and gold. Because the global economic climate remains uncertain it could result in an increase in demand for crypto and increased prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in ones showing interest in cryptocurrency. Retail investors, or even individual investors, are also starting to participate in the crypto market. In the future, as more everyday people are educated about crypto and the best ways to invest in it, this could lead to more demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto grows, more and more people are beginning to learn about it and comprehend it. As the awareness and acceptance of crypto grows it could result in increasing numbers of people purchasing as well as holding the crypto that could increase prices.
faze banks crypto
The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market that enables financial services to be developed upon blockchain technology. As DeFi expands and more platforms and projects are launched, it will lead to a rise in adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the crypto market is growing increasing numbers of companies are beginning 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.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned instruments for investing, are starting to explore cryptocurrency as a possible asset class. As more of these funds devote a percentage of their assets to digital currencies, it could result in a rise in demand and increased prices.
Cryptocurrency is used for payment across borders
One of the biggest benefits of cryptocurrency is its ability to make swift and affordable cross-border transactions. As more and more people and businesses begin to use cryptocurrency for international transactions, this could lead to increased demand and higher costs.
The number of ATMs that accept crypto is increasing.
As the number of crypto ATM’s increase it will be more convenient for people to buy and keep cryptocurrency, which can drive up demand and prices.
Development of security tokens
Security tokens, also known as digital assets that represent ownership in an asset such as stock or real estate, are a rapidly growing sector of the crypto market. As more security tokens are created and traded, this could result in a rise in demand and higher rates for the crypto.
Merchants are more likely to adopt the concept.
In the event that more merchants start accepting cryptocurrency as a method of payment, it makes it easier for consumers to hold and use crypto, which could increase demand and price.
So, is crypto likely to increase in 2023? The only way to know is time. But with these factors to consider, it’s possible that the crypto market could have a rebound by 2023. And for those who are committed to the long-term Being patient and disciplined is crucial.