It’s been a rough experience for the crypto market through 2022. In November the market was down by more than 70 percent from the previous high on November 20, 2021. Just when the market was looking down after the FTX crash turned things even worse. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has experienced its fair share of dips in the past. Every time, it’s bounced back with a big increase.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for more than a year before hitting a low of $150. But, in 2017, it broke the record, and hit a new highest of $19,600. Then, in 2018, and it was trading at $3,100. And in the year 2020 it struck through that resistance and reached a new high of $68,000 in November 2021. Then, just like that we’ve had 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
As we’ve seen previously, dips are typically followed by a lengthy bull run, which eventually overcomes the resistance set by the previous market’s highest price. This pattern is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in recent years. With more and more businesses and industries embracing the technology, its use and acceptance is increasing. From gaming to finance cryptocurrency is being utilized in many ways. This growing demand could result in increasing participation in the crypto market which could boost prices.
The rise in interest of institutions in crypto
In recent times we’ve noticed a growing demand from investors of institutional scale in crypto. From banks to hedge funds and even large corporations are starting to explore the possibilities of crypto assets. The increased interest of institutions could provide more stability to the crypto market and result in higher prices.
Regulations of the government
As the crypto market is maturing, governments around the world are beginning to develop more favorable regulations for crypto. This will help draw more investors as well as increase the mainstream adoption of crypto.
More use cases for blockchain
The technology that is the basis of many cryptocurrencies, blockchain, offers a variety of applications that go that go beyond financial transactions. For example, from supply chain management and voting, many and more industries are exploring ways they can make use of blockchain technology. This could drive more investment and interest in cryptocurrency.
Technology advancements
Crypto and blockchain technology are at the very beginning of development. As progress is made in areas like security and scalability, the potential of cryptocurrency assets will continue to grow. This could lead to more acceptance and higher prices.
Rising global economic uncertainty
Due to the constant economic uncertainty brought on through the COVID-19 pandemic, as well as other causes, more and more investors are looking for safe haven assets like cryptocurrency and gold. Since the economic outlook for the world remains uncertain and uncertain, this could lead to increased demand for crypto and 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 invest in the crypto market. With increasing numbers of people learn about crypto and how to invest in it, this could lead to increased demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto continues to mature as more and more people are starting to learn about it and comprehend it. As awareness and acceptance of crypto grows it could result in more people buying as well as holding the crypto that can drive up prices.
goldobsessed are pouring billions crypto
Decentralized finance (DeFi) is a rapidly growing area of the crypto market, which allows the provision of financial services created upon blockchain technology. As DeFi expands and more projects and platforms come online, this will lead to a rise in adoption and increased prices for crypto.
Developments in crypto payment methods
As the market for crypto is growing as more and more businesses are starting using crypto to be a method of payment. This could result in increased use of crypto in regular transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are government-owned investment vehicles, are starting to explore crypto as an asset class. As more funds dedicate a part or their entire portfolios to cryptocurrency, this could lead to increased demand and increased prices.
Use of crypto for payment across borders
One of the major benefits of cryptocurrency is its ability to make fast and cheap cross-border payments. As more individuals and businesses are beginning to make use of crypto for international transactions, this could lead to increased the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
As the number of crypto ATM’s increase it will be easier for consumers to purchase and hold crypto, which could drive up demand and prices.
The development of security tokens
Security tokens, which are digital assets that are used to represent ownership in an asset such as stocks or real estate are rapidly expanding segment of the cryptocurrency market. With the increasing number of security tokens being created and traded, it can lead to a higher demand and consequently higher costs for cryptocurrency.
More adoption by merchants
In the event that more merchants accept cryptocurrency as a method of payment, it will make it more convenient for customers to use and hold cryptocurrency, which will drive up demand and prices.
Will crypto be on the increase in 2023? It’s only time to find out. But with these factors being considered, it’s possible that the crypto market will see a recovery in 2023. If you’re in it for the long haul, being patient and disciplined is essential.