It’s been a rough ride for the crypto market until 2022. As of November the market had dropped by 70% from its previous peak in November 2021. And just when things were getting worse, the FTX crash turned things even more dire. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has experienced many dips over the years. And every time, it’s rebounded with a big rally.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for more than a year, reaching a low of $150. In 2017 it broke that record and hit a record record high of $19,600. Then, in 2018, and it was trading at $3,100. And in 2020, the price broke through the resistance and hit a new high of $68,000 in November 2021. Then, just like that we’ve seen another dip. But history shows us that after each dip there’s a bull-run.
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 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
Crypto and blockchain technology have come a long way in the last few years. With more and better companies and industries adopting it, its usage and acceptance is growing. From finance to gaming cryptocurrency is being utilized in many ways. And this growing use case could result in more people getting involved in the market, which in turn could boost prices.
Increased institutional interest in crypto
In recent years, we’ve seen a growing demand from investors of institutional scale in crypto. From banks to hedge funds and even large corporations are beginning to investigate the potential of crypto assets. This increased interest from institutions can bring stability to the crypto market and could lead to greater prices.
As the market for crypto continues to mature as it matures, governments all over the world are starting to create more favorable rules for cryptocurrency. This could help attract more investors and boost the acceptance of crypto in general.
A broader range of blockchain applications
The technology that underlies the majority of cryptocurrencies, blockchain is a broad range of possible applications that go beyond financial transactions. From supply chain management to voting systems, more industries are beginning to look at ways they can make use of blockchain technology. This could increase investment and enthusiasm in crypto.
Crypto and blockchain technology are at the very beginning of development. As progress is made in areas like security and scalability, potential of crypto assets will continue to expand. This could lead to more acceptance and higher prices.
Rising global economic uncertainty
In the current instability in the economy caused through the COVID-19 pandemic and other factors many investors are beginning to look for safe haven assets like cryptocurrency and gold. Because the global economic climate is uncertain it could result in increased demand for crypto and increased prices.
Interest from retail investors
The institutional investors aren’t alone in one who’s showing an interest in crypto. Retail investors, or even individual investors are also beginning to get involved in the crypto market. In the future, as more people are educated about crypto and how to invest in it, this could lead to increased demand and higher prices.
The growing awareness and acceptance of crypto
As the crypto market grows as more and more people are beginning to become aware about and understand it. As the awareness and acceptance of crypto grows, this could lead to more people purchasing or holding cryptocurrency, and this can increase prices.
llc for mining crypto
The Decentralized Finance (DeFi) is an emerging area of the crypto market, which allows finance services built upon blockchain technology. As DeFi expands and more platforms and projects come online, this could result in increased use and more expensive prices for crypto.
Advances in crypto-based payment methods
As the crypto market is growing, more and more companies are starting accepting crypto payments as a form of payment. This could lead to an increase in the use of crypto in everyday transactions and higher prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as owned by the state as investments, are starting to show interest in cryptocurrency as a possible asset class. As more funds devote a percentage of their portfolio to crypto, this could increase demand and increased prices.
Utilization of crypto to make payment across borders
One of the major benefits of crypto is the ability to make quick and inexpensive cross-border payments. As more and more people and businesses begin to use cryptocurrency for international transactions it could result in increased the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
As the number of ATMs for crypto increase it will be easier for people to buy and hold crypto, which will increase demand and price.
The development of security tokens
Security tokens, or digital assets that signify ownership of an asset, like real estate or stock, are a rapidly growing sector of the crypto market. Since more and more security tokens will be created and traded, this could result in a rise in demand and consequently higher rates for the crypto.
More adoption by merchants
In the event that more retailers begin accepting crypto as a form of payment, it will make it more convenient for people to utilize and store cryptocurrency, which will drive up demand and prices.
So, will crypto increase in 2023? It’s only time to find out. However, with these aspects in mind, it’s possible that the crypto market will have a rebound by 2023. If you’re looking to invest for the long haul patience and discipline is crucial.