It’s been a rough experience for the crypto market until 2022. In November the market was down by 70 percent from its previous high in November 2021. And just when things were going downhill, the FTX crash turned them even worse. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced its fair share of drops in the past. And every time, it has bounced back with a huge increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for a full year before reaching a bottom of $150. In 2017, it broke the record, and hit a new highest of $19,600. Fast forward to 2018, the price was at $3,100. And in the year 2020 it struck through the resistance and reached a new high of $68,000 in November 2021. Just like that, we’ve witnessed another drop. However, history has shown us that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs are usually followed by a long bull run that eventually breaks through the resistance created by the market’s previous highest price. This pattern can be seen in more than Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have progressed a lot in recent years. With more and more businesses and industries embracing the technology, its use and acceptance is increasing. From banking to gaming, crypto is being used in a variety of ways. And this growing use case could result in more people being involved in the market which could increase the price.
Increased institutional interest in cryptocurrency
In recent times, we’ve seen a growing curiosity from institutions investing in crypto. From hedge funds to banks and even large corporations are starting to explore the possibilities of crypto assets. The increased interest of institutions can bring stability to the market for crypto and could lead to greater prices.
Regulations from the Government
As the crypto market is maturing and mature, governments across the globe are beginning to develop more favorable rules for cryptocurrency. This will help draw more investors and boost the adoption rate of crypto.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrencies, blockchain, is a broad range of potential use cases that go beyond financial transactions. From supply chain management to voting systems, more and more industries are exploring ways they can make use of blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Crypto and blockchain technology are at the very beginning of development. As progress is made in areas such as security and scalability, potential of crypto assets will increase. This could lead to greater acceptance and higher prices.
Uncertainty in the global economy
Due to the constant economic uncertainty brought on due to the COVID-19 pandemic as well as other factors, more and more investors are beginning to look for safe haven investments like gold and crypto. As the global economic situation is uncertain it could result in an increase in demand for crypto and increased prices.
Interest from retail investors
The institutional investors aren’t alone in ones showing interest in crypto. Retail investors, or individual investors are also beginning to invest in the market for crypto. As more and more people learn about crypto and the best ways to invest 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 crypto market continues to mature increasing numbers of people are beginning to learn about and appreciate the concept. As the awareness and acceptance of cryptocurrency grows, it will lead to increasing numbers of people purchasing as well as holding the crypto that could raise prices.
is there pdt on crypto
Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market that allows finance services built on top of blockchain technology. As DeFi expands and more platforms and projects become available, this could result in increased use and higher prices for crypto.
The development of crypto payment methods
As the market for crypto continues to grow as more and more businesses are starting accepting crypto payments as a method of payment. This could lead to increased use of crypto in regular transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are state-owned investment vehicles, are starting to look at crypto as an 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.
Cryptocurrency is used for international payments
One of the biggest benefits of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more individuals and businesses are beginning to make use of cryptocurrency for international transactions, this could lead to increased demand and higher costs.
An increasing number of crypto ATM’s
With the amount of ATMs for crypto increase it will be more convenient for people to buy and hold crypto, which will drive up demand and prices.
Development of security tokens
Security tokens, or digital assets that are used to represent ownership of an asset, like stocks or real estate is a fast-growing segment of the cryptocurrency market. Since more and more security tokens will be issued and traded, it could lead to increased demand and consequently higher costs for cryptocurrency.
A greater adoption rate by merchants
As more and more retailers start accepting cryptocurrency as a method of payment, it will make it easier for customers to use and hold crypto, which could increase demand and price.
So, will crypto rise in 2023? The only way to know is time. However, with these aspects to consider, it’s likely that the crypto market could be able to see a rebound in 2023. And for those who are looking to invest for the long haul patience and discipline is essential.