It’s been a difficult ride for the crypto market in 2022. As of November the market was down by 70 percent from the previous high in November 2021. Just when the market was going downhill, the FTX crash turned things even worse. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced its fair share of dips in the past. Every time, it’s bounced back with a big increase.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for more than a year, reaching a low of $150. But, in 2017, it broke the record, and hit a new high of $19,600. Fast forward to 2018, the price was at $3,100. In 2020, the price broke that resistance and hit a new high of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. However, history has shown us that after each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs tend to be followed by a prolonged bull run that eventually overcomes the resistance set by the previous market’s highest price. This pattern is evident in more than Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have made significant progress in recent years. With more and better companies and industries adopting the technology, its use and acceptance is growing. From banking to gaming the use of crypto is increasing in many ways. And this growing use case could lead to increasing participation in the market, which in turn could boost prices.
The rise in interest of institutions in cryptocurrency
In recent years, we’ve seen a growing demand from investors of institutional scale in cryptocurrency. From hedge funds to banks, many large institutions are starting to explore the potential in crypto currencies. This increased interest from institutions could bring more stability to the market for crypto and result in more expensive prices.
Regulations from the Government
As the crypto market continues to mature as it matures, governments all over the world are beginning to develop more favorable regulations for cryptocurrency. This is likely to attract more investors and boost the adoption rate of crypto.
Blockchain has many more applications.
The technology that is the basis of the majority of cryptocurrencies, blockchain is a broad range of potential use cases beyond the realm of financial transactions. From supply chain management to voting systems, more industries are beginning to look at ways they can make use of blockchain technology, which could stimulate more investment and excitement in cryptocurrency.
Technology advancements
Crypto and blockchain technology are still in the beginning stages of development. As advancements continue to be made in areas like security and scalability, the potential of crypto assets will expand. This could result in more adoption and higher prices.
Uncertainty in the global economy
With the ongoing economic uncertainty caused by the COVID-19 pandemic as well as other factors, more and more investors are starting to look for safe haven investments like bitcoin and even gold. As the global economic situation is uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Interest from retail investors
Investors from institutions aren’t the only one who’s showing an interest in crypto. Retail investors, or individual investors, are also starting to get involved in the crypto market. In the future, as more everyday people become aware of crypto and the best ways to invest in it This could result in an increase in demand and consequently higher prices.
Growing awareness and acceptance of crypto
As the crypto market is maturing, more and more people are beginning to learn about it and comprehend it. As understanding and acceptance grows of crypto, this could lead to increasing numbers of people purchasing and holding crypto, which can drive up prices.
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Decentralized finance (DeFi) is an emerging area of the crypto market that enables financial services to be created using blockchain technology. As DeFi continues to grow and more platforms and projects are launched, it will lead to a rise in adoption and higher prices for crypto.
The development of crypto payment methods
As the market for crypto is growing increasing numbers of companies are starting using crypto to be a form of payment. This could result in increased use of crypto in everyday transactions, and a rise in prices.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned investment vehicles, are beginning to explore crypto as a potential asset class. As more of these funds allocate a portion of their assets to digital currencies, it could increase demand and higher prices.
Cryptocurrency is used for payment across borders
One of the biggest benefits of crypto is its ability to facilitate quick and inexpensive cross-border payments. As more individuals and businesses are beginning to make use of crypto for international transactions, this can lead to a rise in the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
As the number of ATMs for crypto continue to grow it will be more convenient for consumers to purchase and store crypto, which could drive up demand and prices.
Security tokens are developed for development
Security tokens, or digital assets that are used to represent ownership in an asset such as stocks or real estate are rapidly expanding segment of the cryptocurrency market. As more security tokens are created and traded, this could lead to increased demand and higher rates for the crypto.
A greater adoption rate by merchants
With the increasing number of retailers accept crypto as a form of payment, this will make it more convenient for customers to use and hold cryptocurrency, which will increase demand and price.
Will crypto be on the grow in 2023? The only way to know is time. With these things to consider, it’s likely that the cryptocurrency market will be able to see a rebound in 2023. For those in it for the long-term Being patient and disciplined is essential.