It’s been a rough journey for the cryptocurrency market through 2022. As of November the market had dropped by 70 percent from the previous high on November 20, 2021. Just when the market was going downhill after the FTX crash made them look more dire. What is the likelihood that the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen many drops in the past. And every time, it has bounced back with a big rally.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for more than a year before reaching a bottom of $150. In 2017, it broke the record and hit a record highest of $19,600. In 2018, it was trading at $3,100. And in 2020, the price broke that resistance and hit a new highest of $68,000 in November 2021. And just like that, we’ve had another dip. However, history has shown us that after each 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 prolonged bull run that eventually overcomes the resistance set by the previous high price. This pattern is evident not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in the last few years. With more and more companies and industries embracing the technology, its use and acceptance is rising. From banking to gaming, crypto is being used in many ways. And this growing use case can 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 crypto
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 in crypto currencies. The increasing interest from institutions could bring more stability to the market for crypto and could lead to more expensive prices.
Regulations from the Government
As the crypto market continues to mature and mature, governments across the globe are starting to create more favorable rules for cryptocurrency. This will help draw more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The technology that underlies the majority of cryptocurrencies, blockchain offers a variety of applications that go that go beyond financial transactions. For example, from supply chain management and voting, many industries are starting to explore how they can make use of blockchain technology. This could drive more investment and interest in crypto.
Advancements in technology
Crypto and blockchain technology are still in the early stages of development. As advances continue to be made in areas such as security and scalability, potential of crypto assets will expand. This could lead to greater acceptance and higher prices.
Uncertainty in the global economy
Due to the constant instability in the economy caused by the COVID-19 pandemic as well as other factors increasing numbers of investors are starting to look for safe haven assets such as cryptocurrency and gold. Since the economic outlook for the world is uncertain it could result in more demand for crypto as well as 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 participate in the crypto market. In the future, as more everyday people learn about crypto and the best ways to invest in it this could result in more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto continues to mature, more and more people are beginning to become aware about it and comprehend it. As awareness and acceptance of cryptocurrency grows, it will lead to more people buying as well as holding the crypto that could raise prices.
how do you know your earning crypto on minergate
Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market, which allows financial services to be created upon blockchain technology. As DeFi expands and more projects and platforms become available, this could result in increased use and higher prices for crypto.
Developments in crypto 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 result in increased use of crypto in regular transactions, and a rise in prices.
The increased investment of sovereign wealth funds
The sovereign wealth fund, also known as government-owned instruments for investing, are beginning to explore cryptocurrency as a possible asset class. As more funds allocate a portion or their entire portfolios to cryptocurrency, this could increase demand and increased prices.
Use of crypto for payment across borders
One of the main advantages of crypto is its ability to facilitate fast and cheap cross-border payments. As more and more people and businesses are beginning to make use of cryptocurrency for international transactions, it could result in increased demand and higher costs.
An increasing number of crypto ATM’s
The number of crypto ATM’s increase it will be more convenient for people to buy and hold cryptocurrency, which can boost demand and increase prices.
Development of security tokens
Security tokens, or digital assets that are used to represent ownership of an asset, like stocks or real estate is a fast-growing segment of the cryptocurrency market. With the increasing number of security tokens being created and traded, it could lead to increased demand and consequently higher costs for cryptocurrency.
Merchants are more likely to adopt the concept.
As more and more retailers start accepting cryptocurrency as a method of payment, it will make it more convenient for people to utilize and store crypto, which could increase demand and price.
Will crypto be on the grow in 2023? The only way to know is time. But with these factors being considered, it’s likely that the cryptocurrency market will have a rebound by 2023. For those looking to invest for the long run Being patient and disciplined is crucial.