It’s been a tough experience for the crypto market until 2022. By November the market had dropped by more than 70 percent from its previous high in November 2021. When things were getting worse after the FTX crash turned them worse. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen its fair share of dips over the years. Every time, it’s rebounded with a huge rally.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year before reaching a bottom of $150. In 2017 it broke that record, and hit a new high of $19,600. Fast forward to 2018, the price was at $3,100. And in the year 2020 it struck that resistance and hit 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
As we’ve seen previously, dips tend to be followed by a prolonged bull run, which eventually breaks through the resistance created by the previous high price. This pattern can be seen in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in recent years. With more and more companies and industries adopting the technology, its use and acceptance is increasing. From finance to gaming cryptocurrency is being utilized in a myriad of ways. And this growing use case could result in more people getting involved in the market, which in turn could increase the price.
The rise in interest of institutions in cryptocurrency
In the last few years we’ve witnessed a rising curiosity from institutions investing in cryptocurrency. From hedge funds to banks and even large corporations are starting to explore the possibilities of crypto assets. This increased interest from institutions can bring stability to the crypto market and lead to more expensive prices.
Regulations from the Government
As the crypto market grows and mature, governments across the globe are beginning to develop more favorable regulations for crypto. This will help draw more investors as well as increase the adoption rate of crypto.
Blockchain has many more applications.
The underlying technology behind many cryptocurrencies, blockchain, offers a variety of applications that go that go beyond financial transactions. In addition to supply chain management, voting and other systems companies are exploring ways they can utilize blockchain technology, which could drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Crypto and blockchain technology are still in the beginning stages of development. As advances continue to be made in areas such as scalability and security, the potential of cryptocurrency assets will continue to expand. This could lead to more adoption and higher prices.
Uncertainty in the global economy
In the current instability in the economy caused due to the COVID-19 pandemic as well as other factors many investors are starting to look for safe haven assets such as bitcoin and even gold. Because the global economic climate remains 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 cryptocurrency. Retail investors, also known as individual investors are also beginning to get involved in the crypto market. With increasing numbers of people learn about cryptocurrency and investing 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 market for crypto is maturing as more and more people are beginning to become aware about and understand the concept. As understanding and acceptance of cryptocurrency grows, it will lead to more people buying and holding crypto, which can drive up prices.
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The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market, which allows finance services built using blockchain technology. As DeFi expands and more projects and platforms become available, this could lead to increased adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the crypto market continues to grow increasing numbers of companies are beginning to accept crypto as a form of payment. This could result in increased use of crypto in regular transactions, and a rise in prices.
More investment from sovereign wealth funds
Sovereign wealth funds, which are owned by the state as 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 result in a rise in demand and higher prices.
Utilization of crypto to make payment across borders
One of the biggest benefits of crypto is the ability to make swift and affordable cross-border transactions. As more individuals and businesses start to utilize cryptocurrency for international transactions this could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
The number of crypto ATM’s continue to increase, it will become easier for individuals to purchase and hold cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, also known as digital assets that signify ownership of an asset, like real estate or stock, are a rapidly growing segment of the cryptocurrency market. Since more and more security tokens will be issued and traded, this could lead to increased demand and higher rates for the crypto.
More adoption by merchants
As more and more businesses start accepting cryptocurrency as a method of payment, it will make it more convenient for people to utilize and store crypto, which can drive up demand and prices.
So, will crypto increase in 2023? The only way to know is time. However, with these aspects to consider, it’s possible that the crypto market will have a rebound by 2023. If you’re in it for the long haul Being patient and disciplined is essential.