It’s been a rough experience for the crypto market in 2022. As of November, the market had dipped by 70 percent from its previous high on November 20, 2021. Just when the market was looking down and down, the FTX crash turned things even more dire. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen many dips in the past. Every time, it’s rebounded by a massive rise.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year before hitting a low of $150. However, in 2017, it broke that record, and hit a new high of $19,600. Then, in 2018, the price was at $3,100. And in 2020, the price broke through the resistance, and reached a record high of $68,000 in November 2021. And just like that, we’ve seen another dip. However, history has shown us that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs tend to be followed by a long bull run, which eventually surpasses the resistance created by the market’s previous highest price. This pattern is evident not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in the last few years. With more and better companies and industries taking to it, its usage and acceptance is growing. From banking to gaming the use of crypto is increasing in many ways. And this growing use case can lead to more people being involved in the market which could increase the price.
Increased institutional interest in cryptocurrency
In recent years we’ve noticed a growing curiosity from institutions investing in cryptocurrency. From banks to hedge funds, many large institutions are starting to explore the potential for crypto-based assets. The increased interest of institutions could bring more stability to the crypto market and result in more expensive prices.
Government regulations
As the crypto market grows, governments around the world are beginning to develop more favorable regulations for cryptocurrency. This is likely to attract more investors and boost the adoption rate of crypto.
Blockchain has many more applications.
The technology that underlies the majority of cryptocurrencies, blockchain has a wide range of possible applications beyond just financial transactions. For example, from supply chain management and voting, many industries are starting to explore how they can utilize blockchain technology, which could stimulate more investment and excitement in cryptocurrency.
Technology advancements
Crypto and blockchain technology are still in the early stages of development. As progress is made in areas like security and scalability, the potential of crypto assets will increase. This could lead to greater acceptance and higher prices.
Uncertainty in the global economy
In the current economic uncertainty brought on by the COVID-19 pandemic as well as other factors increasing numbers of investors are beginning to look for safe haven assets like cryptocurrency and gold. Because the global economic climate remains uncertain it could result in an increase in demand for crypto and more expensive prices.
Interest from retail investors
Institutional investors aren’t the only ones showing interest in crypto. Retail investors, or individual investors, are also starting to invest in the crypto market. In the future, as more people are educated about crypto and the best ways to invest in it This could result in increased demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the crypto market continues to mature, more and more people are beginning to learn about and appreciate it. As understanding and acceptance of cryptocurrency grows, it will lead to more people buying and holding crypto, which could increase prices.
lepricon crypto
The Decentralized Finance (DeFi) is an emerging area of the crypto market that allows the provision of financial services built on top of blockchain technology. As DeFi expands and more platforms and projects become available, this will lead to a rise in adoption and increased prices for crypto.
The development of crypto payment methods
As the market for crypto grows increasing numbers of companies are beginning using crypto to be a means of payment. This could lead to an increase in the use of crypto in everyday transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned investments, are starting to look at crypto as an asset class. As more of these funds dedicate a part or their entire portfolios to cryptocurrency, it could increase demand and increased prices.
Use of crypto for international payments
One of the main advantages of crypto is the capability to perform swift and affordable cross-border transactions. As more individuals and businesses begin to use crypto for international transactions, this could lead to increased demand and higher costs.
The number of ATMs that accept crypto is increasing.
The number of ATMs for crypto continue to increase, it will become easier for consumers to purchase and keep crypto, which could drive up demand and prices.
The development of security tokens
Security tokens, or digital assets that signify ownership of an asset, like stocks or real estate are rapidly expanding area of the crypto market. As more security tokens are created and traded, it could result in a rise in demand and higher costs for cryptocurrency.
More adoption by merchants
In the event that more merchants begin accepting cryptocurrency as a method of payment, this will make it easier for consumers to utilize and store cryptocurrency, which will increase demand and price.
Will crypto be on the grow in 2023? Only time will tell. With these things being considered, it’s possible that the cryptocurrency market will have a rebound by 2023. If you’re looking to invest for the long-term patience and discipline is crucial.