It’s been a rough journey for the cryptocurrency market until 2022. As of November, the market had dipped by more than 70 percent from the previous high at the end of November. And just when things were looking down and down, the FTX crash turned things worse. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had many dips over the years. Every time, it’s bounced back by a massive rally.
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. But, in 2017, it broke the record, and hit a new record high of $19,600. Then, in 2018, it was trading at $3,100. And in the year 2020 it struck that resistance, and reached a record high of $68,000 in November 2021. Then, just like that we’ve had another dip. But history shows us that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
As we’ve seen in the past, dips tend to be followed by a lengthy bull run that finally surpasses the resistance created by the market’s previous highest price. This pattern is evident in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in the last few years. With more and more businesses and industries taking to it, its usage and acceptance is rising. From finance to gaming cryptocurrency is being utilized in many ways. The growing popularity of crypto could result in increasing participation in the market and, in turn, increase the price.
A rise in the interest of institutions for crypto
In the last few years we’ve noticed a growing demand from investors of institutional scale in cryptocurrency. From hedge funds to banks, many large institutions are beginning to investigate the potential for crypto-based assets. The increasing interest from institutions could bring more stability to the crypto market and could lead to greater prices.
Regulations of the government
As the crypto market grows as it matures, governments all over the world are starting to create more favorable rules for cryptocurrency. This is likely to attract more investors and increase the adoption rate of crypto.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrency, blockchain, is a broad range of applications that go beyond the realm of financial transactions. In addition to supply chain management, voting and other systems companies are starting to explore how they can benefit from blockchain technology. This will drive more investment and interest in cryptocurrency.
Technology advancements
Blockchain technology and cryptography are still in the early stages of development. As progress is made in areas like security and scalability, the potential of cryptocurrency assets will continue to increase. This could lead to greater adoption and higher prices.
Global economic uncertainty is growing
In the current economic uncertainty brought on through the COVID-19 pandemic as well as other factors, more and more investors are starting to look for safe haven investments like gold and crypto. Because the global economic climate remains uncertain it could result in more demand for crypto as well as increased prices.
Interest from retail investors
Investors from institutions aren’t the only ones showing interest in crypto. Retail investors, or individual investors are also beginning to participate in the crypto market. As more and more people learn about crypto and the best ways to invest in it, this could lead to increased demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the market for crypto is maturing, more and more people are starting to learn about and understand it. As awareness and acceptance grows of crypto, this could lead to more people purchasing and holding crypto, which could drive up prices.
hbar crypto price now
Decentralized finance (DeFi) is a rapidly growing area of the crypto market that allows financial services to be developed using blockchain technology. As DeFi grows and more projects and platforms become available, this could lead to increased adoption and more expensive prices for crypto.
Advances in crypto-based payment methods
As the market for crypto grows increasing numbers of companies are starting accepting crypto payments as a means of payment. This could result in increased use of crypto in regular transactions, and a rise in prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned instruments for investing, are now beginning to show interest in crypto as a potential asset class. As more funds allocate a portion of their portfolio to crypto, this could lead to increased demand and higher prices.
Utilization of crypto to make international payments
One of the major benefits of crypto is the ability to make quick and inexpensive cross-border payments. 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.
Increasing numbers of crypto ATM’s
As the number of crypto ATM’s continue to grow it will be easier for consumers to purchase and keep cryptocurrency, which can boost demand and increase prices.
The development of security tokens
Security tokens, which are digital assets that represent ownership in an asset such as stocks or real estate, are a rapidly growing segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, it can lead to a higher demand, and thus higher rates for the crypto.
Merchants are more likely to adopt the concept.
As more and more businesses start accepting crypto as a means of payment, this will make it more convenient for customers to use and hold cryptocurrency, which will increase demand and price.
So, will crypto grow in 2023? It’s only time to find out. With these things in mind, it’s possible that the crypto market could see a recovery in 2023. And for those who are committed to the long run, being patient and disciplined will be key.