It’s been a tough experience for the crypto market through 2022. By November the market was down by more than 70 percent from the previous high in November 2021. Just when the market was looking down and down, the FTX crash made them look even more dire. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced many dips over the years. Every time, it’s bounced back with a big rally.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for more than a year before reaching a bottom of $150. However, in 2017 it broke that record, and hit a new highest of $19,600. In 2018, and it was trading at $3,100. And in 2020, the price broke that resistance and reached a new high of $68,000 in November 2021. Then, just like that we’ve had another dip. However, the past has proven that at the end of every dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs tend to be followed by a long bull run that eventually breaks through 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
Blockchain and cryptocurrency technology has made significant progress in recent years. With more and more businesses and industries adopting the technology, its use and acceptance is rising. From finance to gaming cryptocurrency is being utilized in a myriad of ways. The growing popularity of crypto could result in more people being involved in the crypto market and, in turn, increase the price.
Increased institutional interest in crypto
In recent years, we’ve seen a growing curiosity from institutions investing in cryptocurrency. From banks to hedge funds numerous large institutions are now exploring the possibilities of crypto assets. The increasing interest from institutions could provide more stability to the market for crypto and could lead to greater prices.
Regulations from the Government
As the crypto market grows, governments around the world are beginning to establish more favorable rules for crypto. This will help draw more investors and increase the acceptance of crypto in general.
A broader range of blockchain applications
The underlying technology behind many cryptocurrency, blockchain, has a wide range of applications that go beyond the realm of financial transactions. For example, from supply chain management and voting, many and more industries are starting to explore how they can make use of blockchain technology. This will drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the beginning stages of development. As progress is made in areas such as security and scalability, potential of cryptocurrency assets will continue to grow. This could lead to more acceptance and higher prices.
Global economic uncertainty is growing
In the current instability in the economy caused due to the COVID-19 pandemic as well as other factors, more and more investors are starting to look for safe haven assets such as cryptocurrency and gold. As the global economic situation remains uncertain it could result in increased demand for crypto and more expensive prices.
Interest from retail investors
Institutional investors aren’t the only ones showing interest in cryptocurrency. Retail investors, or individual investors, are also starting to get involved in the market for crypto. In the future, as more everyday people are educated about cryptocurrency and investing in it, this could lead to increased demand and higher prices.
Growing awareness and acceptance of crypto
As the crypto market grows, more and more people are beginning to learn about and appreciate it. As awareness and acceptance grows of crypto, it will lead to more people purchasing as well as holding the crypto that could raise prices.
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Decentralized finance (DeFi) is a rapidly growing area of the crypto market that allows finance services developed upon blockchain technology. As DeFi expands and more platforms and projects come online, this could lead to increased adoption and higher prices for crypto.
The development of crypto payment methods
As the crypto market is growing, more and more companies are starting to accept crypto as a method of payment. This could lead to an increase in the use of crypto in everyday transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are state-owned investments, are now beginning to look at crypto as a potential asset class. As more funds allocate a portion of their portfolio to crypto, it could lead to increased demand and more expensive prices.
Use of crypto for international payments
One of the main advantages of cryptocurrency is its capability to perform quick and inexpensive cross-border payments. As more and more people and businesses begin to use crypto 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 for crypto continue to grow it will be more convenient for consumers to purchase and keep crypto, which could drive up demand and prices.
Security tokens are developed for development
Security tokens, or digital assets that represent ownership in an asset such as real estate or stock are rapidly expanding area of the crypto market. With the increasing number of security tokens being issued and traded, it could lead to increased demand and consequently higher rates for the crypto.
More adoption by merchants
With the increasing number of retailers accept cryptocurrency as a method of payment, this will make it easier for consumers to hold and use crypto, which could drive up demand and prices.
Will crypto be on the rise in 2023? It’s only time to find out. With these things to consider, it’s possible that the crypto market will have a rebound by 2023. And for those who are in it for the long-term Being patient and disciplined will be key.