It’s been a tough ride for the crypto market through 2022. In November the market had dropped by 70 percent from its previous high in November 2021. Just when the market was getting worse after the FTX crash made them look even worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many dips in the past. Every time, it has bounced back with a big rally.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year before hitting a low of $150. In 2017 it broke that record and hit a record record high of $19,600. In 2018, the price was at $3,100. In the year 2020 it struck through that resistance and reached a new peak of $68,000 in the month of November 2021. And just like that, we’ve seen another dip. 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 in the past, dips are typically followed by a lengthy bull run that finally surpasses the resistance created by the previous market’s highest price. This pattern is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have progressed a lot in recent years. With more and more businesses and industries embracing it, its usage and acceptance is growing. From gaming to finance cryptocurrency is being utilized in a variety of ways. The growing popularity of crypto could result in more people being involved in the crypto market which could drive the prices up.
Increased institutional interest in cryptocurrency
In recent years, we’ve seen a growing curiosity from institutions investing in crypto. From hedge funds to banks numerous large institutions are beginning to investigate the possibilities for crypto-based assets. The increased interest of institutions can bring stability to the market for crypto and could lead to higher prices.
Regulations of the government
As the crypto market is maturing and mature, governments across the globe are starting to create more favorable rules for crypto. This could help attract more investors and boost the acceptance of crypto in general.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrencies, blockchain, offers a variety of applications that go beyond just financial transactions. From supply chain management to voting systems, more companies are beginning to look at ways they can make use of blockchain technology, which could drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is still in the beginning stages of development. As progress is made in areas like security and scalability, the potential of crypto assets will continue to grow. This could lead to more adoption and higher prices.
Global economic uncertainty is growing
Due to the constant instability in the economy caused by the COVID-19 pandemic and other factors increasing numbers of investors are starting to look for safe haven assets like gold and crypto. 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
Investors from institutions aren’t the only 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 are educated about crypto and the best ways to invest in it This could result in increased demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto is maturing increasing numbers of people are beginning to learn about and appreciate the concept. As the awareness and acceptance grows of crypto, this could lead to increasing numbers of people purchasing and holding crypto, which could drive up prices.
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Decentralized finance (DeFi) is an emerging area of the crypto market that allows financial services to be created upon blockchain technology. As DeFi continues to grow and more platforms and projects become available, this will lead to a rise in adoption and more expensive prices for crypto.
The development of crypto payment methods
As the crypto market grows, more and more companies are starting to accept crypto as a means of payment. This could lead to an increase in the use of crypto in everyday transactions and higher prices.
Increased investment from sovereign wealth funds
These funds are government-owned instruments for investing, are now beginning to look at cryptocurrency as a possible asset class. As more funds devote a percentage of their assets to digital currencies, it could lead to increased demand and increased prices.
Utilization of crypto to make payment across borders
One of the biggest benefits of crypto is its ability to make swift and affordable cross-border transactions. As more businesses and individuals start to utilize crypto for international transactions, it could result in increased demand and higher prices.
An increasing number of crypto ATM’s
As the number of ATMs for crypto continue to grow, it will become easier for people to buy and hold crypto, which will boost demand and increase prices.
Security tokens are developed for development
Security tokens, or digital assets that signify ownership in an asset such as stock or real estate, are a rapidly growing area of the crypto market. Since more and more security tokens will be created and traded, this could result in a rise in demand, and thus higher prices for crypto.
A greater adoption rate by merchants
With the increasing number of merchants accept crypto as a form of payment, this makes it easier for customers to hold and use cryptocurrency, which will increase demand and price.
So, will crypto rise in 2023? Only time will tell. But with these factors in mind, it’s likely that the crypto market could have a rebound by 2023. If you’re in it for the long run Being patient and disciplined will be key.