It’s been a difficult experience for the crypto market until 2022. By November the market had dropped by 70 percent from the previous high at the end of November. And just when things were getting worse after the FTX crash turned them even worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had its fair share of drops in the past. Every time, it’s bounced back with a big rally.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year before hitting a low of $150. However, in 2017, it broke the record, and hit a new highest of $19,600. Then, in 2018, it was trading at $3,100. In 2020, it broke that resistance and hit a new peak of $68,000 in the month of November 2021. Then, just like that we’ve witnessed another drop. 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 prolonged bull run, which eventually breaks through the resistance created by the previous market’s highest price. This pattern can be seen in more than Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in recent years. With more and more companies and industries adopting the technology, its use and acceptance is increasing. From gaming to finance cryptocurrency is being utilized in a variety of ways. The growing popularity of crypto could result in more people being involved in the market, which in turn could boost prices.
The rise in interest of institutions in cryptocurrency
In recent years we’ve witnessed a rising interest from institutional investors in crypto. From banks to hedge funds and even large corporations are starting to explore the possibilities in crypto currencies. The increased interest of institutions could provide more stability to the market for crypto and lead to more expensive prices.
Regulations of the government
As the market for crypto continues to mature as it matures, governments all over the world are beginning to develop more favorable rules for cryptocurrency. This is likely to attract more investors as well as increase the adoption rate of crypto.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrencies, blockchain, offers a variety of possible applications beyond the realm of financial transactions. From supply chain management to voting systems, more and more industries are beginning to look at ways they can benefit from blockchain technology. This could increase investment and enthusiasm in cryptocurrency.
Technology advancements
Crypto and blockchain technology are still in the beginning stages of development. As advancements continue to be made in areas such as security and scalability, potential of crypto assets will expand. This could result in more adoption and higher prices.
Rising global economic uncertainty
In the current economic uncertainty brought on due to the COVID-19 pandemic, as well as other causes increasing numbers of investors are beginning to look for safe haven assets like cryptocurrency and gold. As the global economic situation remains uncertain, this could lead to more demand for crypto as well as more expensive prices.
Interest from retail investors
The institutional investors aren’t alone in ones showing interest in cryptocurrency. Retail investors, also known as individual investors are also beginning to participate in the crypto market. In the future, as more people learn about crypto and how to invest in it this could result in more demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto grows, more and more people are starting to learn about and understand it. As understanding and acceptance of cryptocurrency grows it could result in increasing numbers of people purchasing and holding crypto, which could drive up prices.
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Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market that allows finance services developed on top of blockchain technology. As DeFi continues to grow and more projects and platforms are launched, it could result in increased use and increased prices for crypto.
The development of crypto payment methods
As the market for crypto is growing as more and more businesses are beginning accepting crypto payments as a means of payment. This could lead to an increase in the usage of crypto in daily transactions, and a rise in prices.
More investment from sovereign wealth funds
These funds are owned by the state as instruments for investing, are starting to show interest in crypto as an asset class. As more of these funds devote a percentage of their portfolio to crypto, this could result in a rise in demand and increased prices.
Cryptocurrency is used for cross-border payments
One of the main advantages of crypto is the ability to make fast and cheap cross-border payments. As more and more people 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
As the number of crypto ATM’s continue to grow it will be more convenient for consumers to purchase and store crypto, which could increase demand and price.
Security tokens are developed for development
Security tokens, which are digital assets that represent ownership of an asset, like real estate or stock is a fast-growing segment of the cryptocurrency market. As more security tokens are created and traded, it could lead to increased demand and higher costs for cryptocurrency.
A greater adoption rate by merchants
With the increasing number of merchants start accepting crypto as a form of payment, it will make it easier for people to use and hold cryptocurrency, which will increase demand and price.
So, is crypto likely to increase in 2023? Only time will tell. With these things being considered, it’s possible that the cryptocurrency market will have a rebound by 2023. And for those who are in it for the long haul Being patient and disciplined will be key.