It’s been a rough ride for the crypto market through 2022. In November the market had dropped by more than 70 percent from the previous high on November 20, 2021. And just when things were going downhill, the FTX crash made them look even worse. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced its fair share of dips in the past. Every time, it has bounced back by a massive rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for a full year before reaching a bottom of $150. In 2017, it broke the record, and hit a new highest of $19,600. Then, in 2018, it was trading at $3,100. And in the year 2020 it struck through that resistance, and reached a record highest of $68,000 in November 2021. And just like that, we’ve had another dip. But history shows us that following each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs are typically followed by a prolonged bull run that finally surpasses the resistance created by the previous market’s highest price. This is evident in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have made significant progress in the last few years. With more and more businesses and industries embracing the technology, its use and acceptance is growing. From gaming to finance, crypto is being used in a myriad of ways. And this growing use case could lead to increasing participation in the market and, in turn, increase the price.
Increased institutional interest in crypto
In recent years we’ve witnessed a rising interest from institutional investors in crypto. From hedge funds to banks and even large corporations are beginning to investigate the possibilities for crypto-based assets. The increased interest of institutions could bring more stability to the market for crypto and result in greater prices.
Government regulations
As the market for crypto continues to mature, governments around the world are beginning to develop more favorable regulations for crypto. This is likely to attract more investors and boost the acceptance of crypto in general.
Blockchain has many more applications.
The technology that underlies many cryptocurrencies, blockchain, has a wide range of applications that go beyond the realm of financial transactions. From supply chain management to voting systems, more industries are exploring ways they can utilize blockchain technology. This could increase investment and enthusiasm in cryptocurrency.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is still in the early stages of development. As advancements continue to be made in areas like security and scalability, the potential of crypto assets will continue to grow. This could result in more acceptance and higher prices.
Rising global economic uncertainty
Due to the constant instability in the economy caused by the COVID-19 pandemic, as well as other causes increasing numbers of investors are starting to look for safe haven assets like bitcoin and even gold. As the global economic situation remains uncertain it could result in more demand for crypto as well as increased prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in one who’s showing an interest in cryptocurrency. Retail investors, or individual investors, are also starting to invest in the cryptocurrency market. In the future, as more everyday people learn about crypto and how to invest in it This could result in more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto grows, more and more people are starting to learn about it and comprehend it. As awareness and acceptance grows of crypto, this could lead to increasing numbers of people purchasing as well as holding the crypto that can drive up prices.
hyperchain x crypto
Financial decentralization (DeFi) is a rapidly growing area of the crypto market that enables financial services to be created upon blockchain technology. As DeFi expands and more platforms and projects are launched, it could lead to increased adoption and more expensive prices for crypto.
Advances in crypto-based payment methods
As the market for crypto continues to grow increasing numbers of companies are beginning using crypto to be a form of payment. This could lead to an increase in the use of crypto in regular transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
These funds are government-owned instruments for investing, are beginning to show interest in crypto as a potential asset class. As more of these funds devote a percentage of their portfolio to crypto, this could increase demand and more expensive prices.
Use of crypto for cross-border payments
One of the major benefits of crypto is the ability to facilitate swift and affordable cross-border transactions. As more businesses and individuals are beginning to make use of cryptocurrency for international transactions this could lead to increased the demand for it and a rise in prices.
An increasing number of crypto ATM’s
The number of ATMs that accept crypto continue to grow, it will become easier for individuals to purchase and hold crypto, which could 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 stocks or real estate, are a rapidly growing sector of the crypto market. Since more and more security tokens will be created and traded, it can lead to a higher demand and consequently higher costs for cryptocurrency.
Merchants are more likely to adopt the concept.
As more and more businesses start accepting cryptocurrency as a method of payment, this makes it easier for people to use and hold crypto, which can boost demand and increase prices.
Will crypto be on the increase in 2023? Only time will tell. With these things in mind, it’s possible that the cryptocurrency market will be able to see a rebound in 2023. And for those who are committed to the long haul patience and discipline is essential.