It’s been a difficult experience for the crypto market until 2022. As of November the market was down by more than 70 percent from its previous high in November 2021. And just when things were going downhill and down, the FTX crash turned them worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has experienced many drops in the past. Each time, it’s bounced back with a big increase.
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 hit a record high of $19,600. In 2018, the price was at $3,100. In 2020, the price broke through that resistance, and reached a record high of $68,000 in November 2021. And just like that, we’ve seen 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 in the past, dips are typically followed by a long bull run that eventually surpasses the resistance created by the previous market’s highest price. This is evident not only in Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in the last few years. With more and more businesses and industries adopting it, its usage and acceptance is increasing. From gaming to finance, crypto is being used in many ways. And this growing use case could result in increasing participation in the crypto market, which in turn could boost prices.
The rise in interest of institutions in cryptocurrency
In recent times, we’ve seen a growing interest from institutional investors in crypto. From banks to hedge funds, many large institutions are beginning to investigate the potential in crypto currencies. The increased interest of institutions could bring more stability to the market for crypto and result in greater prices.
Regulations of the government
As the market for crypto grows and mature, governments across the globe are starting to create more favorable regulations for cryptocurrency. This is likely to 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 cryptocurrency, blockchain, has a wide range of potential use cases beyond just financial transactions. From supply chain management to voting systems, more and more industries are starting to explore how they can benefit from blockchain technology, which could drive more investment and interest in cryptocurrency.
Advancements in technology
Blockchain technology and cryptography are at the very beginning of development. As progress is made in areas such as scalability and security, the potential of cryptocurrency assets will continue to expand. This could result in more acceptance and higher prices.
Global economic uncertainty is growing
With the ongoing instability in the economy caused due to the COVID-19 pandemic as well as other factors increasing numbers of investors are starting to look for safe haven investments like bitcoin and even gold. As the global economic situation remains 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 one who’s showing an interest in cryptocurrency. Retail investors, or individual investors, are also starting to participate in the cryptocurrency market. With increasing numbers of everyday people learn about crypto and how to invest in it This could result in increased demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the crypto market is maturing as more and more people are beginning to learn about and appreciate it. As awareness and acceptance of cryptocurrency grows, it will lead to increasing numbers of people purchasing and holding crypto, which can raise prices.
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The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market, which allows finance services built on top of blockchain technology. As DeFi grows and more platforms and projects become available, this could lead to increased adoption and increased prices for crypto.
The development of crypto payment methods
As the market for crypto continues to grow, more and more companies are starting to accept crypto as a means of payment. This could lead to an increase in the use of crypto in everyday transactions, and a rise in prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as owned by the state as investment vehicles, are beginning to look at crypto as a potential asset class. As more funds dedicate a part of their assets to digital currencies, this could increase demand and more expensive prices.
Cryptocurrency is used for international payments
One of the biggest benefits of crypto is the ability to facilitate swift and affordable cross-border transactions. As more individuals and businesses begin to use cryptocurrency for international transactions this can lead to a rise in the demand for it and a rise in prices.
An increasing number of crypto ATM’s
With the amount of ATMs that accept crypto increase it will be more convenient for consumers 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 in an asset like stocks or real estate is a fast-growing sector of the crypto market. As more security tokens are issued and traded, it could lead to increased demand and consequently higher prices for crypto.
A greater adoption rate by merchants
As more and more merchants accept crypto as a means of payment, this will make it easier for people to hold and use cryptocurrency, which will boost demand and increase prices.
So, is crypto likely to grow in 2023? Only time will tell. But with these factors to consider, it’s possible that the cryptocurrency market will be able to see a rebound in 2023. For those in it for the long-term Being patient and disciplined will be key.