It’s been a difficult journey for the cryptocurrency market until 2022. As of November the market was down by 70 percent from its previous high on November 20, 2021. Just when the market was going downhill after the FTX crash turned things worse. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had many dips over the years. Every time, it’s bounced back by a massive rally.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for a full year before hitting a low of $150. In 2017, it broke the record, and hit a new record high of $19,600. In 2018, and it was trading at $3,100. In the year 2020 it struck through that resistance and reached a new peak of $68,000 in the month of November 2021. And just like that, we’ve witnessed another drop. However, the past has proven that after each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen in the past, dips are usually followed by a lengthy bull run that finally overcomes the resistance set by the previous high price. This is evident in more than Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in recent years. With more and more businesses and industries embracing it, its usage and acceptance is growing. From finance to gaming the use of crypto is increasing in a myriad of ways. The growing popularity of crypto could result in increasing participation in the market and, in turn, boost prices.
The rise in interest of institutions in crypto
In recent times we’ve witnessed a rising interest from institutional investors in crypto. From hedge funds to banks numerous large institutions are now exploring the possibilities for crypto-based assets. The increasing interest from institutions could bring more stability to the crypto market and result in more expensive prices.
Regulations from the Government
As the market for crypto grows as it matures, governments all over the world are starting to create more favorable rules for crypto. This will help draw more investors and boost the acceptance of crypto in general.
A broader range of blockchain applications
The underlying technology behind many cryptocurrency, blockchain, offers a variety of possible applications beyond just financial transactions. In addition to supply chain management, voting and other systems industries are starting to explore how they can make use of blockchain technology, which could stimulate more investment and excitement in cryptocurrency.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas like security and scalability, potential of crypto assets will continue to grow. This could lead to more adoption and higher prices.
Rising global economic uncertainty
In the current economic uncertainty caused by the COVID-19 pandemic, as well as other causes many investors are looking for safe haven assets such as cryptocurrency and gold. Since the economic outlook for the world remains uncertain it could result in more demand for crypto as well as more expensive prices.
Interest from retail investors
Institutional investors aren’t the only ones showing interest in cryptocurrency. Retail investors, or even individual investors, are also starting to get involved in the crypto market. With increasing numbers of everyday people become aware of crypto and the best ways to invest in it This could result in more demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto grows increasing numbers of people are beginning to become aware about it and comprehend it. As the awareness and acceptance of crypto grows, it will lead to more people buying as well as holding the crypto that could drive up prices.
Financial decentralization (DeFi) is an emerging area of the crypto market that enables financial services to be built upon blockchain technology. As DeFi expands and more projects and platforms become available, this could result in increased use and more expensive prices for crypto.
Advances in crypto-based payment methods
As the market for crypto continues to grow increasing numbers of companies are starting accepting crypto payments as a means of payment. This could lead to increased use of crypto in regular transactions, and a rise in prices.
More investment from sovereign wealth funds
Sovereign wealth funds, which are state-owned investment vehicles, are beginning to explore crypto as a potential 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 main advantages of crypto is its ability to facilitate fast and cheap cross-border payments. As more and more people and businesses are beginning to make use of cryptocurrency for international transactions it could result in increased demand and higher costs.
An increasing number of crypto ATM’s
The number of crypto ATM’s continue to grow it will be more convenient for individuals to purchase and store cryptocurrency, which can drive up demand and prices.
The development of security tokens
Security tokens, which are digital assets that signify ownership of an asset, such as real estate or stock, are a rapidly growing segment of the cryptocurrency market. With the increasing number of security tokens being created and traded, it can lead to a higher demand, and thus higher costs for cryptocurrency.
Merchants are more likely to adopt the concept.
With the increasing number of retailers accept crypto as a form of payment, this will make it more convenient for people to use and hold cryptocurrency, which will boost demand and increase prices.
So, will crypto grow in 2023? The only way to know is time. With these things to consider, it’s possible that the crypto market will see a recovery in 2023. For those committed to the long-term Being patient and disciplined is crucial.