It’s been a tough experience for the crypto market until 2022. In November the market was down by more than 70 percent from its previous high at the end of November. And just when things were going downhill, the FTX crash made them look more dire. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen its fair share of dips over the years. And every time, it’s rebounded by a massive rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year, reaching a low of $150. However, in 2017 it broke that record and hit a record high of $19,600. In 2018, the price was at $3,100. And in the year 2020 it struck through that resistance and reached a new peak of $68,000 in the month of November 2021. Then, just like that we’ve witnessed another drop. But history shows us that following each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen previously, dips tend to be followed by a long bull run that finally overcomes the resistance set by the previous market’s highest price. This pattern is evident in more than Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in the last few years. With more and better companies and industries adopting it, its usage and acceptance is increasing. From finance to gaming, crypto is being used in many ways. And this growing use case could result in more people getting involved in the crypto market which could drive the prices up.
The rise in interest of institutions in cryptocurrency
In recent years, we’ve seen a growing curiosity from institutions investing in cryptocurrency. From banks to hedge funds numerous large institutions are now exploring the possibilities in crypto currencies. This increased interest from institutions could provide more stability to the market for crypto and could lead to more expensive prices.
Regulations from the Government
As the market for crypto is maturing, governments around the world are starting to create more favorable regulations for cryptocurrency. This is likely to 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 applications that go beyond just financial transactions. In addition to supply chain management, voting and other systems and more industries are exploring ways they can make use of blockchain technology, which could drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the beginning stages of development. As advancements continue to be made in areas like scalability and security, the potential of crypto assets will continue to grow. This could lead to greater acceptance and higher prices.
Rising global economic uncertainty
Due to the constant economic uncertainty brought on due to the COVID-19 pandemic as well as other factors many investors are beginning to look for safe haven assets such as bitcoin and even gold. As the global economic situation remains uncertain and uncertain, this could lead to more demand for crypto as well as higher prices.
Interest from retail investors
The institutional investors aren’t alone in people who are interested in cryptocurrency. Retail investors, also known as individual investors, are also starting to participate in the cryptocurrency market. As more and more everyday people learn about crypto and the best ways to invest in it, this could lead to an increase in demand and consequently higher prices.
The growing awareness and acceptance of cryptocurrency
As the crypto market continues to mature as more and more people are beginning to become aware about and understand the concept. As understanding and acceptance of crypto grows, it will lead to more people purchasing as well as holding the crypto that can increase prices.
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Decentralized finance (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 are launched, it could lead to increased adoption and higher prices for crypto.
Developments in crypto payment methods
As the crypto market continues to grow, more and more companies are starting accepting crypto payments as a means of payment. This could lead to increased use of crypto in regular transactions and higher prices.
More investment from sovereign wealth funds
These funds are state-owned instruments for investing, are now beginning to show interest in crypto as an asset class. As more funds allocate a portion of their portfolio to crypto, this could increase demand and higher prices.
Cryptocurrency is used for cross-border payments
One of the biggest benefits of crypto is the capability to perform fast and cheap cross-border payments. As more and more people and businesses start to utilize crypto for international transactions, it could result in increased demand and higher prices.
An increasing number of crypto ATM’s
The number of crypto ATM’s continue to increase it will be easier for consumers to purchase and keep crypto, which will increase demand and price.
Security tokens are developed for development
Security tokens, also known as digital assets that are used to represent ownership of an asset, like real estate or stock are rapidly expanding sector of the crypto market. With the increasing number of security tokens being created and traded, it can lead to a higher demand and higher costs for cryptocurrency.
A greater adoption rate by merchants
In the event that more businesses begin accepting crypto as a form of payment, it will make it more convenient for consumers to hold and use crypto, which could boost demand and increase prices.
So, will crypto rise in 2023? The only way to know is time. But with these factors being considered, it’s possible that the cryptocurrency market will have a rebound by 2023. And for those who are looking to invest for the long haul patience and discipline is essential.