It’s been a rough experience for the crypto market until 2022. As of November the market was down by more than 70% from its previous peak in November 2021. When things were looking down after the FTX crash made them look even worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen many drops in the past. Every time, it’s rebounded with a big increase.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for a full year, reaching a low of $150. However, in 2017, it broke the record, and hit a new highest of $19,600. Fast forward to 2018, it was trading at $3,100. And in the year 2020 it struck through the resistance and hit a new peak of $68,000 in the month of November 2021. Then, just like that we’ve had another dip. But history shows us that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen in the past, dips are typically followed by a lengthy bull run, which eventually surpasses the resistance created by the previous market’s highest price. This pattern is evident not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in recent years. With more and more companies and industries adopting the technology, its use and acceptance is rising. From banking to gaming, crypto is being used in a myriad of ways. And this growing use case can lead to more people getting involved in the crypto market and, in turn, drive the prices up.
Increased institutional interest in crypto
In recent times we’ve noticed a growing interest from institutional investors in cryptocurrency. From banks to hedge funds, many large institutions are beginning to investigate the potential of crypto assets. The increased interest of institutions can bring stability to the market for crypto and result in more expensive prices.
Regulations from the Government
As the crypto market grows, governments around the world are beginning to establish more favorable regulations for cryptocurrency. This could help attract more investors as well as increase the acceptance of crypto in general.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrencies, blockchain, is a broad range of possible applications beyond the realm of financial transactions. From supply chain management to voting systems, more and more industries are beginning to look at ways they can benefit from blockchain technology. This will increase investment and enthusiasm in crypto.
Technology advancements
Blockchain and cryptocurrency technology is still in the early stages of development. As progress is made in areas like security and scalability, potential of cryptocurrency assets will continue to expand. This could lead to greater use and increase in prices.
Rising global economic uncertainty
In the current instability in the economy caused due to the COVID-19 pandemic as well as other factors many investors are looking for safe haven assets such as cryptocurrency and gold. As the global economic situation remains uncertain and uncertain, this could lead to an increase in demand for crypto and higher prices.
Interest from retail investors
Institutional investors aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, or individual investors, are also starting to get involved in the cryptocurrency market. In the future, as more people become aware of cryptocurrency and investing in it, this could lead to increased demand and higher prices.
The growing awareness and acceptance of crypto
As the crypto market continues to mature as more and more people are starting to learn about and appreciate the concept. As the awareness and acceptance of cryptocurrency grows, it will lead to more people buying or holding cryptocurrency, and this could increase prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market, which allows finance services built upon blockchain technology. As DeFi grows and more platforms and projects become available, this could lead to increased adoption and increased prices for crypto.
Advances in crypto-based payment methods
As the crypto market continues to grow as more and more businesses are starting using crypto to be a form of payment. This could result in increased use of crypto in everyday transactions and higher prices.
More investment from sovereign wealth funds
These funds are government-owned investments, are beginning to show interest in crypto as a potential asset class. As more of these funds dedicate a part of their portfolio to crypto, this could lead to increased demand and increased prices.
Use of crypto for international payments
One of the biggest benefits of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more businesses and individuals are beginning to make use of crypto for international transactions, it could result in increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
The number of ATMs for crypto continue to grow it will be more convenient for people to buy and hold crypto, which could increase demand and price.
The development of security tokens
Security tokens, which are digital assets that represent ownership of an asset, like real estate or stock are rapidly expanding area of the crypto market. With the increasing number of security tokens being created and traded, it could lead to increased demand, and thus higher prices for crypto.
Merchants are more likely to adopt the concept.
In the event that more businesses begin accepting crypto as a means of payment, this will make it more convenient for consumers to utilize and store cryptocurrency, which will drive up demand and prices.
So, will crypto increase in 2023? The only way to know is time. With these things to consider, it’s likely that the crypto market will see a recovery in 2023. And for those who are in it for the long-term patience and discipline is crucial.