It’s been a tough journey for the cryptocurrency market through 2022. As of November the market had dropped by more than 70% from its previous peak on November 20, 2021. When things were going downhill and down, the FTX crash made them look worse. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had its fair share of dips over the years. Every time, it’s bounced back with a huge increase.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year, reaching a low of $150. However, in 2017 it broke that record and hit a record record high of $19,600. Then, in 2018, it was trading at $3,100. In the year 2020 it struck that resistance and hit a new highest of $68,000 in November 2021. Just like that, we’ve had another dip. However, the past has proven that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips are usually followed by a lengthy bull run that finally overcomes the resistance set by the previous high price. This pattern can be seen not only in Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has made significant progress in recent years. With more and better companies and industries taking to the technology, its use and acceptance is rising. From finance to gaming cryptocurrency is being utilized in a myriad of ways. This growing demand could lead to more people being involved in the market which could boost prices.
A rise in the interest of institutions for crypto
In the last few years we’ve witnessed a rising interest from institutional investors in crypto. From hedge funds to banks and even large corporations are beginning to investigate the possibilities in crypto currencies. This increased interest from institutions could provide more stability to the crypto market and result in more expensive prices.
Government regulations
As the crypto market continues to mature, governments around the world are starting to create more favorable regulations for cryptocurrency. This is likely to attract more investors and increase the adoption rate of crypto.
A broader range of blockchain applications
The underlying technology behind many cryptocurrency, blockchain, has a wide range of possible applications 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 increase investment and enthusiasm in crypto.
Technology advancements
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas like security and scalability, the potential of crypto assets will continue to grow. This could lead to more adoption and higher prices.
Rising global economic uncertainty
Due to the constant economic uncertainty caused due to the COVID-19 pandemic as well as other factors, more and more investors are beginning to look for safe haven assets such as bitcoin and even gold. As the global economic situation is uncertain and uncertain, this could lead to an increase in demand for crypto and more expensive prices.
Retail investors are able to earn interest
Institutional investors aren’t the only one who’s showing an interest in crypto. Retail investors, or 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 increased demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market is maturing as more and more people are beginning to learn about and understand the concept. As the awareness and acceptance grows of crypto, it will lead to more people buying as well as holding the crypto that can drive up prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market that enables finance services created upon blockchain technology. As DeFi grows and more projects and platforms are launched, it could result in increased use and increased prices for crypto.
The development of crypto payment methods
As the crypto market grows, more and more companies are starting to accept crypto 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
These funds are government-owned instruments for investing, are starting to explore crypto as an asset class. As more of these funds devote a percentage of their portfolio to crypto, this could result in a rise in demand and more expensive prices.
Utilization of crypto to make international payments
One of the biggest benefits of crypto is its ability to make swift and affordable cross-border transactions. As more and more people and businesses start to utilize cryptocurrency for international transactions, it could result in increased the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
As the number of ATMs for crypto increase it will be more convenient for people to buy and hold crypto, which will drive up demand and prices.
Security tokens are developed for development
Security tokens, which are digital assets that are used to represent ownership in an asset such as stocks or real estate, are a rapidly growing sector of the crypto market. Since more and more security tokens will be issued and traded, this could lead to increased demand, and thus higher rates for the crypto.
A greater adoption rate by merchants
With the increasing number of retailers begin accepting crypto as a form of payment, this makes it easier for people to hold and use crypto, which can boost demand and increase prices.
Will crypto be on the rise in 2023? Only time will tell. But with these factors being considered, it’s likely that the cryptocurrency market will be able to see a rebound in 2023. And for those who are committed to the long run Being patient and disciplined is crucial.