It’s been a tough experience for the crypto market in 2022. By November the market was down by more than 70 percent from its previous high at the end of November. When things were getting worse after the FTX crash turned them more dire. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced its fair share of drops in the past. Each time, it’s bounced back with a huge increase.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for over a year, reaching a low of $150. In 2017, it broke that record and reached a new high of $19,600. In 2018, it was trading at $3,100. In the year 2020 it struck through the resistance, and reached a record high of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. 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 previously, dips are usually followed by a prolonged bull run that finally surpasses the resistance created by the market’s previous highest price. This pattern can be seen in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in the last few years. With more and better companies and industries embracing it, its usage and acceptance is growing. From finance to gaming the use of crypto is increasing in a myriad of ways. This growing demand could result in increasing participation in the crypto market which could boost prices.
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 banks to hedge funds numerous large institutions are beginning to investigate the possibilities of crypto assets. The increasing interest from institutions could bring more stability to the market for crypto and lead to more expensive prices.
Regulations of the government
As the crypto market grows and mature, governments across the globe are beginning to establish more favorable regulations for cryptocurrency. This will help draw more investors as well as increase the mainstream adoption of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrencies, blockchain, offers a variety of potential use cases beyond just financial transactions. For example, from supply chain management and voting, many and more industries are starting to explore how they can utilize blockchain technology. This will increase investment and enthusiasm in cryptocurrency.
Blockchain technology and cryptography are still in the beginning stages of development. As advancements continue to be made in areas such as security and scalability, the potential of crypto assets will continue to expand. This could result in more adoption and higher prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty brought on by the COVID-19 pandemic and other factors increasing numbers of investors are looking for safe haven assets like cryptocurrency and gold. Because the global economic climate remains uncertain and uncertain, this could lead to an increase in demand for crypto and more expensive prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only ones showing interest in cryptocurrency. Retail investors, also known as individual investors, are also starting to get involved in the crypto market. In the future, as more people are educated about crypto and how 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 become aware about it and comprehend it. As the awareness and acceptance of crypto grows, it will lead to more people buying or holding cryptocurrency, and this can increase prices.
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Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market that allows the provision of financial services built on top of blockchain technology. As DeFi continues to grow and more projects and platforms come online, this could lead to increased adoption and higher prices for crypto.
The development of crypto payment methods
As the market for crypto grows increasing numbers of companies are beginning to accept crypto as a form of payment. This could lead to increased use of crypto in everyday transactions and higher prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned instruments for investing, are starting to show interest in crypto as an asset class. As more funds devote a percentage of their assets to digital currencies, it could increase demand and more expensive prices.
Utilization of crypto to make payment across borders
One of the main advantages of crypto is its ability to make quick and inexpensive cross-border payments. As more businesses and individuals begin to use crypto for international transactions, it could result in increased the demand for it and a rise in prices.
An increasing number of crypto ATM’s
The number of ATMs that accept crypto continue to grow it will be easier for people to buy and keep cryptocurrency, which can boost demand and increase prices.
Development of security tokens
Security tokens, also known as digital assets that represent ownership of an asset, like stock or real estate is a fast-growing sector of the crypto market. With the increasing number of security tokens being created and traded, it could result in a rise in demand and consequently higher rates for the crypto.
A greater adoption rate by merchants
In the event that more retailers accept crypto as a form of payment, this will make it easier for customers to use and hold crypto, which can increase demand and price.
So, is crypto likely to increase in 2023? It’s only time to find out. With these things to consider, it’s possible that the cryptocurrency market will have a rebound by 2023. If you’re in it for the long-term Being patient and disciplined is crucial.