It’s been a tough journey for the cryptocurrency market until 2022. By November, the market had dipped by 70 percent from its previous high at the end of November. And just when things were getting worse, the FTX crash turned them more dire. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many drops in the past. Each time, it’s rebounded by a massive rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year, reaching a low of $150. In 2017, it broke that record and reached a new high of $19,600. In 2018, it was trading at $3,100. In the year 2020 it struck through that resistance and hit a new peak of $68,000 in the month of November 2021. Just like that, we’ve had another dip. However, the past has proven that following 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 are typically followed by a long bull run that eventually overcomes the resistance set by the market’s previous highest price. This pattern can be seen not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have progressed a lot in the last few years. With more and more companies and industries embracing it, its usage and acceptance is increasing. From finance to gaming the use of crypto is increasing in a myriad of ways. And this growing use case could lead to more people getting involved in the market and, in turn, boost prices.
A rise in the interest of institutions for cryptocurrency
In recent years we’ve witnessed a rising demand from investors of institutional scale in cryptocurrency. From banks to hedge funds and even large corporations are now exploring the possibilities of crypto assets. This increased interest from institutions could provide more stability to the market for crypto and result in higher prices.
Regulations from the Government
As the crypto market is maturing and mature, governments across the globe are beginning to establish more favorable rules for crypto. This is likely to attract more investors as well as increase the mainstream adoption of crypto.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrencies, blockchain, is a broad range of applications that go that go beyond financial transactions. In addition to supply chain management, voting and other systems industries are exploring ways they can benefit from blockchain technology. This could stimulate more investment and excitement in crypto.
Technology advancements
Blockchain and cryptocurrency technology is still in the early stages of development. As advances continue to be made in areas like scalability and security, the potential of cryptocurrency assets will continue to increase. This could result in more use and increase in prices.
Rising global economic uncertainty
In the current economic uncertainty caused by the COVID-19 pandemic, as well as other causes many investors are starting to look for safe haven investments like bitcoin and even gold. Because the global economic climate is uncertain and uncertain, this could lead to increased demand for crypto and increased 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 cryptocurrency market. With increasing numbers of people learn about cryptocurrency and investing in it, this could lead to more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market continues to mature as more and more people are beginning to learn about and understand the concept. As the awareness and acceptance of crypto grows, it will lead to more people buying or holding cryptocurrency, and this can increase prices.
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Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market that enables financial services to be developed upon blockchain technology. As DeFi expands and more projects and platforms become available, this could lead to increased adoption and higher prices for crypto.
The development of crypto payment methods
As the crypto market grows, more and more companies are beginning accepting crypto payments as a means of payment. This could lead to increased usage of crypto in daily transactions and higher prices.
Increased investment from sovereign wealth funds
These funds are owned by the state as investments, are now beginning to look at crypto as a potential asset class. As more of these funds devote a percentage or their entire portfolios to cryptocurrency, it could lead to increased demand and more expensive prices.
Utilization of crypto to make international payments
One of the major benefits of crypto is its ability to facilitate quick and inexpensive cross-border payments. As more and more people and businesses begin to use cryptocurrency for international transactions, it could result in increased demand and higher costs.
The number of ATMs that accept crypto is increasing.
As the number of ATMs that accept crypto continue to grow, it will become easier for people to buy and store crypto, which will drive up demand and prices.
Development of security tokens
Security tokens, also known as digital assets that represent ownership of an asset, such as stocks 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 higher costs for cryptocurrency.
Merchants are more likely to adopt the concept.
With the increasing number of merchants begin accepting cryptocurrency as a method of payment, this will make it easier for consumers to hold and use cryptocurrency, which will boost demand and increase prices.
So, will crypto rise in 2023? The only way to know is time. But with these factors to consider, it’s likely that the crypto market will see a recovery in 2023. If you’re in it for the long-term patience and discipline is crucial.