It’s been a tough ride for the crypto market in 2022. As of November the market was down by more than 70 percent from the previous high at the end of November. Just when the market was going downhill and down, the FTX crash turned things even worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has had its fair share of dips over the years. Every time, it’s rebounded with a huge increase.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for over a year before hitting a low of $150. But, in 2017 it broke that record and reached a new high of $19,600. Fast forward to 2018, it was trading at $3,100. In 2020, the price broke that resistance and reached a new highest of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. However, history has shown us that following each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs tend to be followed by a long bull run that eventually surpasses the resistance created by the market’s previous highest 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 more businesses and industries taking to the technology, its use and acceptance is growing. From finance to gaming, crypto is being used in many ways. And this growing use case could lead to more people getting involved in the crypto market, which in turn could drive the prices up.
A rise in the interest of institutions for cryptocurrency
In recent years we’ve noticed a growing interest from institutional investors in cryptocurrency. From banks to hedge funds, many large institutions are starting to explore the potential for crypto-based assets. The increased interest of institutions could bring more stability to the crypto market and lead to higher prices.
Regulations from the Government
As the market for crypto continues to mature and mature, governments across the globe are beginning to develop more favorable rules for crypto. This could help attract more investors and increase the adoption rate of crypto.
More use cases for blockchain
The underlying technology behind many cryptocurrency, blockchain, offers a variety of potential use cases that go beyond financial transactions. For example, from supply chain management and voting, many companies are beginning to look at ways they can make use of blockchain technology, which could drive more investment and interest in crypto.
Advancements in technology
Crypto and blockchain technology are still in the early stages of development. As advancements continue to be made in areas like security and scalability, the potential of cryptocurrency assets will continue to increase. This could result in more acceptance 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 increasing numbers of investors are looking for safe haven assets such as cryptocurrency and gold. As the global economic situation is uncertain and uncertain, this could lead to increased demand for crypto and increased prices.
Retail investors are able to earn interest
Institutional investors aren’t the only people who are interested in crypto. Retail investors, or even individual investors, are also starting to get involved in the market for crypto. In the future, as more people become aware of crypto and how to invest in it this could result in an increase in demand and consequently higher prices.
The growing awareness and acceptance of cryptocurrency
As the crypto market is maturing, more and more people are beginning to learn about it and comprehend it. As awareness and acceptance of crypto grows, this could lead to increasing numbers of people purchasing and holding crypto, which could increase prices.
hedron crypto price prediction
Decentralized finance (DeFi) is an emerging area of the crypto market that enables the provision of financial services built on top of blockchain technology. As DeFi expands and more platforms and projects become available, this could lead to increased adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the crypto market continues to grow as more and more businesses are starting accepting crypto payments as a form of payment. This could lead to an increase in the usage of crypto in daily transactions and higher prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as state-owned instruments for investing, are starting to explore crypto as a potential asset class. As more of these funds dedicate a part of their portfolio to crypto, this could increase demand and increased prices.
Use of crypto for payment across borders
One of the major benefits of cryptocurrency is its ability to facilitate fast and cheap cross-border payments. As more and more people and businesses are beginning to make use of crypto for international transactions, this could lead to increased demand and higher prices.
An increasing number of crypto ATM’s
With the amount of crypto ATM’s increase it will be more convenient for people to buy and hold crypto, which could drive up demand and prices.
Development of security tokens
Security tokens, also known as digital assets that represent ownership of an asset, like real estate or stock are rapidly expanding segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, it could lead to increased demand, and thus higher costs for cryptocurrency.
More adoption by merchants
In the event that more retailers accept cryptocurrency as a method of payment, it will make it more convenient for people to hold and use crypto, which could increase demand and price.
Will crypto be on the increase in 2023? Only time will tell. But with these factors to consider, it’s likely that the cryptocurrency market will see a recovery in 2023. And for those who are in it for the long haul patience and discipline will be key.