It’s been a difficult journey for the cryptocurrency market through 2022. In November the market was down by 70 percent from the previous high at the end of November. When things were getting worse and down, the FTX crash turned them worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many drops in the past. And every time, it has bounced back with a huge rise.
In 2013, for instance, 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 reached a new high of $19,600. In 2018, the price was at $3,100. And in the year 2020 it struck through that resistance, and reached a record peak of $68,000 in the month of November 2021. Just like that, we’ve witnessed another drop. But history shows us that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
As we’ve seen in the past, dips are usually followed by a long bull run that finally overcomes the resistance set by the market’s previous highest price. This pattern can be seen in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in the last few years. With more and more businesses and industries embracing the technology, its use and acceptance is rising. From finance to gaming cryptocurrency is being utilized in many ways. The growing popularity of crypto can lead to increasing participation in the market which could increase the price.
Increased institutional interest in cryptocurrency
In recent times we’ve witnessed a rising demand from investors of institutional scale in cryptocurrency. From hedge funds to banks and even large corporations are now exploring the possibilities in crypto currencies. The increasing interest from institutions could provide more stability to the market for crypto and result in greater prices.
Regulations of the government
As the market for crypto grows, governments around the world are beginning to develop more favorable regulations for crypto. This could help attract more investors and boost the mainstream adoption of crypto.
More use cases for blockchain
The underlying technology behind many cryptocurrencies, blockchain, offers a variety of possible applications that go beyond financial transactions. In addition to supply chain management, voting and other systems and more industries are starting to explore how they can utilize blockchain technology. This could increase investment and enthusiasm in crypto.
Technology advancements
Blockchain and cryptocurrency technology is still in the beginning stages of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will continue to increase. This could lead to greater use and increase in prices.
Global economic uncertainty is growing
In the current economic uncertainty caused by the COVID-19 pandemic, as well as other causes, more and more investors are looking for safe haven assets like gold and crypto. Since the economic outlook for the world is 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 ones showing interest in cryptocurrency. Retail investors, or even individual investors, are also starting to participate in the crypto market. As more and more people are educated about crypto and how to invest in it this could result in an increase in demand and consequently higher prices.
Growing awareness and acceptance of crypto
As the crypto market grows increasing numbers of people are beginning to become aware about it and comprehend the concept. As understanding and acceptance of crypto grows, it will lead to more people buying and holding crypto, which can increase prices.
kava crypto review
Decentralized finance (DeFi) is an emerging area of the crypto market that enables the provision of financial services created upon blockchain technology. As DeFi continues to grow and more projects and platforms are launched, it could result in increased use and higher prices for crypto.
Developments in crypto payment methods
As the market for crypto continues to grow, more and more companies are starting using crypto to be a method of payment. This could result in increased use of crypto in everyday transactions and higher prices.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are owned by the state as instruments for investing, are starting to explore cryptocurrency as a possible asset class. As more of these funds allocate a portion of their assets to digital currencies, this could increase demand and higher prices.
Use of crypto for cross-border payments
One of the main advantages of crypto is its capability to perform fast and cheap cross-border payments. As more individuals and businesses are beginning to make use of crypto for international transactions, this can lead to a rise in the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
As the number of crypto ATM’s continue to grow it will be more convenient for consumers to purchase and hold cryptocurrency, which can drive up demand and prices.
The development of security tokens
Security tokens, which are digital assets that signify 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 can lead to a higher demand and consequently higher rates for the crypto.
More adoption by merchants
With the increasing number of businesses start accepting crypto as a means of payment, this will make it more convenient for people to utilize and store cryptocurrency, which will increase demand and price.
So, is crypto likely to rise in 2023? Only time will tell. However, with these aspects to consider, it’s possible that the crypto market could be able to see a rebound in 2023. If you’re committed to the long haul Being patient and disciplined is crucial.