It’s been a difficult ride for the crypto market until 2022. As of November the market had dropped by 70% from its previous peak at the end of November. And just when things were getting worse, the FTX crash turned things even worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen many dips in the past. And every time, it’s bounced back with a huge rise.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for a full year, reaching a low of $150. But, in 2017, it broke the record and hit a record record high of $19,600. In 2018, and it was trading at $3,100. And in 2020, the price broke through the resistance and reached a new high of $68,000 in November 2021. And just like that, we’ve witnessed another drop. 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 before, fall-offs tend to be followed by a long bull run, which eventually overcomes the resistance set by the previous high price. This is evident not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has made significant progress in the last few years. With more and better companies and industries taking to it, its usage and acceptance is growing. From banking to gaming, crypto is being used in many ways. This growing demand could lead to more people being involved in the market and, in turn, drive the prices up.
The rise in interest of institutions in cryptocurrency
In recent years we’ve noticed a growing demand from investors of institutional scale in crypto. From banks to hedge funds and even large corporations are beginning to investigate the possibilities for crypto-based assets. This increased interest from institutions could bring more stability to the crypto market and result in higher prices.
Regulations of the government
As the crypto market is maturing as it matures, governments all over the world are beginning to develop more favorable rules for crypto. This could help attract more investors as well as increase the acceptance of crypto in general.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrency, blockchain, has a wide range of potential use cases 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. This will increase investment and enthusiasm in crypto.
Technologies are constantly evolving.
Blockchain technology and cryptography are at the very beginning of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will expand. This could result in more adoption and higher prices.
Global economic uncertainty is growing
In the current economic uncertainty caused by the COVID-19 pandemic as well as other factors increasing numbers of investors are beginning to look for safe haven assets such as bitcoin and even gold. Because the global economic climate 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
The institutional investors aren’t alone in ones showing interest in cryptocurrency. Retail investors, also known as individual investors, are also starting to invest in the market for crypto. As more and more people are educated about cryptocurrency and investing 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 crypto market continues to mature, more and more people are starting to learn about and understand the concept. As awareness and acceptance of crypto grows it could result in increasing numbers of people purchasing as well as holding the crypto that could raise prices.
gunship battle crypto conflict
Decentralized finance (DeFi) is an emerging area of the crypto market, which allows finance services developed on top of blockchain technology. As DeFi expands and more platforms and projects become available, this will lead to a rise in adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the crypto market is growing, more and more companies are starting accepting crypto payments as a method of payment. This could result in increased use of crypto in regular transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are state-owned investments, are now beginning to show interest in crypto as a potential asset class. As more of these funds devote a percentage of their assets to digital currencies, this could result in a rise in demand and increased prices.
Utilization of crypto to make cross-border payments
One of the major benefits of cryptocurrency is its ability to facilitate quick and inexpensive cross-border payments. As more individuals and businesses start to utilize crypto for international transactions, this could lead to increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
As the number of crypto ATM’s continue to increase it will be easier for people to buy and store cryptocurrency, which can drive up demand and prices.
Development of security tokens
Security tokens, or digital assets that are used to represent ownership in an asset such as stock or real estate, are a rapidly growing segment of the cryptocurrency market. As more security tokens are issued and traded, it could result in a rise in demand, and thus higher prices for crypto.
Merchants are more likely to adopt the concept.
As more and more retailers start accepting crypto as a form of payment, it makes it easier for people to hold and use crypto, which could 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 cryptocurrency market will see a recovery in 2023. For those in it for the long haul patience and discipline is crucial.