It’s been a tough ride for the crypto market through 2022. In November, the market had dipped by more than 70 percent from the previous high in November 2021. When things were getting worse after the FTX crash made them look more dire. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced many dips in the past. And every time, it has bounced back with a big rise.
For instance, in 2013, Bitcoin reached a peak of $1,160, then fell for more than a year before reaching a bottom of $150. In 2017, it broke that record and reached a new high of $19,600. In 2018, the price was at $3,100. And in the year 2020 it struck through the resistance and hit a new highest of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. However, the past has proven that following each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips are typically followed by a long 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 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 increasing. From banking to gaming, crypto is being used in a myriad of ways. This growing demand could result in more people getting involved in the crypto market which could increase the price.
A rise in the interest of institutions for crypto
In recent years we’ve witnessed a rising curiosity from institutions investing in crypto. From hedge funds to banks and even large corporations are beginning to investigate the possibilities of crypto assets. The increasing interest from institutions could bring more stability to the crypto market and 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 will help draw more investors and increase the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that underlies many cryptocurrencies, blockchain, is a broad range 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 increase investment and enthusiasm in cryptocurrency.
Blockchain technology and cryptography are at the very beginning of development. As advances continue to be made in areas like security and scalability, potential of cryptocurrency assets will continue to increase. This could lead to more acceptance and higher prices.
Rising global economic uncertainty
Due to the constant economic uncertainty caused through the COVID-19 pandemic and other factors increasing numbers of investors are starting to look for safe haven investments like gold and crypto. Because the global economic climate is uncertain it could result in more demand for crypto as well as higher prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in people who are interested in crypto. Retail investors, or even individual investors are also beginning to invest in the cryptocurrency market. As more and more people become aware of crypto and how to invest in it this could result in 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 the awareness and acceptance grows of crypto it could result in increasing numbers of people purchasing and holding crypto, which could increase prices.
how to buy flow crypto in usa
Financial decentralization (DeFi) is a rapidly growing area of the crypto market, which allows finance services developed using 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.
Advances in crypto-based payment methods
As the market for crypto continues to grow, more and more companies 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.
Increased investment from sovereign wealth funds
These funds are 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 increase demand and increased prices.
Cryptocurrency is used for international payments
One of the biggest benefits of crypto is its ability to facilitate swift and affordable cross-border transactions. As more businesses and individuals are beginning to make use of crypto for international transactions, it could result in increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
With the amount of ATMs for crypto continue to increase it will be easier for individuals to purchase and store crypto, which will increase demand and price.
The development of security tokens
Security tokens, or digital assets that signify ownership of an asset, like stocks or real estate, are a rapidly growing sector of the crypto market. As more security tokens are created and traded, it could lead to increased demand, and thus higher prices for crypto.
A greater adoption rate by merchants
With the increasing number of retailers begin accepting cryptocurrency as a method of payment, it makes it easier for consumers to utilize and store cryptocurrency, which will drive up demand and prices.
So, will crypto grow in 2023? The only way to know is time. However, with these aspects being considered, it’s likely that the cryptocurrency market will be able to see a rebound in 2023. And for those who are in it for the long haul, being patient and disciplined is essential.