It’s been a difficult journey for the cryptocurrency market until 2022. In November the market was down by 70 percent from its previous high at the end of November. And just when things were looking down, the FTX crash turned them more dire. What is the likelihood that the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced its fair share of dips over the years. Every time, it’s bounced back by a massive rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for more than a year before reaching a bottom of $150. However, in 2017, it broke that record and reached a new highest of $19,600. Then, in 2018, it was trading at $3,100. In the year 2020 it struck that resistance, and reached a record peak of $68,000 in the month of November 2021. Just like that, we’ve witnessed another drop. However, history has shown us that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed previously, dips are typically followed by a lengthy bull run that finally breaks through the resistance created by the previous market’s highest price. This is evident in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in recent years. With more and better companies and industries adopting the technology, its use and acceptance is increasing. From gaming to finance, crypto is being used in a myriad of ways. This growing demand can lead to more people being involved in the market which could boost prices.
A rise in the interest of institutions for crypto
In recent years we’ve noticed a growing interest from institutional investors in cryptocurrency. From banks to hedge funds numerous large institutions are beginning to investigate the potential in crypto currencies. The increasing interest from institutions could bring more stability to the market for crypto and result in greater prices.
Regulations from the Government
As the crypto market grows, governments around the world are starting to create more favorable rules for crypto. This is likely to attract more investors as well as increase the mainstream adoption of crypto.
More use cases for blockchain
The underlying technology behind the majority of cryptocurrencies, blockchain offers a variety of applications that go beyond just financial transactions. In addition to supply chain management, voting and other systems industries are exploring ways they can utilize blockchain technology. This will drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas such as security and scalability, potential of crypto assets will grow. This could lead to greater acceptance and higher prices.
Rising global economic uncertainty
In the current instability in the economy caused by the COVID-19 pandemic and other factors, more and more investors are starting to look for safe haven assets such as gold and crypto. Since the economic outlook for the world is uncertain it could result in more demand for crypto as well as higher prices.
Retail investors are able to earn interest
Institutional investors aren’t the only ones showing interest in crypto. Retail investors, also known as individual investors are also beginning to invest in the cryptocurrency market. As more and more people are educated about crypto and the best ways to invest in it this could result in more demand and higher prices.
Growing awareness and acceptance of crypto
As the crypto market is maturing, more and more people are starting to learn about it and comprehend it. As understanding and acceptance of cryptocurrency grows, it will lead to more people buying and holding crypto, which could raise prices.
how to buy wink crypto
Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market, which allows finance services created on top of blockchain technology. As DeFi grows and more projects and platforms become available, this could lead to increased adoption and increased prices for crypto.
Advances in crypto-based payment methods
As the crypto market grows as more and more businesses are starting using crypto to be a method of payment. This could lead to increased use of crypto in everyday transactions and higher prices.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as owned by the state as instruments for investing, are now beginning to show interest in crypto as a potential asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, it could result in a rise in demand and increased prices.
Utilization of crypto to make cross-border payments
One of the major benefits of cryptocurrency is its ability to facilitate swift and affordable cross-border transactions. As more individuals and businesses start to utilize cryptocurrency for international transactions, it could result in increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
As the number of crypto ATM’s continue to grow it will be easier 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 of an asset, like stock or real estate, are a rapidly growing sector of the crypto market. As more security tokens are issued and traded, it could lead to increased demand, and thus higher rates for the crypto.
A greater adoption rate by merchants
With the increasing number of retailers begin accepting crypto as a means of payment, it makes it easier for consumers to use and hold crypto, which can increase demand and price.
So, is crypto likely to increase in 2023? Only time will tell. But with these factors to consider, it’s possible that the crypto market will see a recovery in 2023. For those looking to invest for the long run patience and discipline is essential.