It’s been a tough ride for the crypto market until 2022. In November the market had dropped by 70% from its previous peak on November 20, 2021. And just when things were looking down after the FTX crash made them look worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had many drops in the past. Every time, it’s rebounded with a huge increase.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for more than a year before hitting a low of $150. However, in 2017, it broke that record and hit a record high of $19,600. Fast forward to 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. However, the past has proven that following each dip the bull runs.
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 overcomes the resistance set by the market’s previous highest price. This pattern is evident in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in recent years. With more and more businesses and industries embracing the technology, its use and acceptance is increasing. From banking to gaming cryptocurrency is being utilized in a variety of ways. This growing demand could result in more people getting involved in the market, which in turn could boost prices.
The rise in interest of institutions in crypto
In recent times, we’ve seen a growing curiosity from institutions investing in crypto. From banks to hedge funds, many large institutions are beginning to investigate the possibilities of crypto assets. The increasing interest from institutions could bring more stability to the crypto market and lead to greater prices.
As the market for crypto is maturing as it matures, governments all over the world are beginning to establish more favorable rules for crypto. This is likely to attract more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The underlying technology behind the majority of cryptocurrencies, blockchain has a wide range of applications that go that go beyond financial transactions. For example, from supply chain management and voting, many industries are beginning to look at ways they can benefit from blockchain technology, which could stimulate more investment and excitement in cryptocurrency.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the beginning stages of development. As advances continue to be made in areas such as scalability and security, the potential of crypto assets will increase. This could lead to greater acceptance and higher prices.
Uncertainty in the global economy
Due to the constant economic uncertainty brought on by the COVID-19 pandemic as well as other factors increasing numbers of investors are beginning to look for safe haven assets such as gold and crypto. Because the global economic climate remains uncertain, this could lead to more demand for crypto as well as more expensive prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only people who are interested in cryptocurrency. Retail investors, or even individual investors, are also starting to get involved in the crypto market. With increasing numbers of people are educated about crypto and how to invest in it This could result in increased demand and higher prices.
The growing awareness and acceptance of crypto
As the market for crypto grows as more and more people are beginning to learn about and understand it. As 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.
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The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market that enables the provision of financial services created on top of blockchain technology. As DeFi grows and more projects and platforms come online, this will lead to a rise in adoption and increased prices for crypto.
Advances in crypto-based payment methods
As the market for crypto grows, more and more companies are beginning using crypto to be a method of payment. This could result in increased use of crypto in regular transactions and higher prices.
More investment from sovereign wealth funds
Sovereign wealth funds, which are state-owned instruments for investing, are now beginning to show interest in crypto as an asset class. As more of these funds devote a percentage of their assets to digital currencies, this could lead to increased demand and higher prices.
Utilization of crypto to make international payments
One of the biggest benefits of crypto is the capability to perform quick and inexpensive 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.
Increasing numbers of crypto ATM’s
The number of ATMs for crypto continue to increase it will be easier for individuals to purchase and store cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, or digital assets that signify ownership in an asset like real estate or stock is a fast-growing segment of the cryptocurrency market. Since more and more security tokens will be issued and traded, it could lead to increased demand and consequently higher rates for the crypto.
Merchants are more likely to adopt the concept.
With the increasing number of businesses start accepting crypto as a means of payment, it will make it easier for consumers to use and hold cryptocurrency, which will boost demand and increase prices.
So, is crypto likely to grow in 2023? The only way to know is time. With these things in mind, it’s likely that the cryptocurrency market will be able to see a rebound in 2023. If you’re committed to the long haul Being patient and disciplined will be key.