It’s been a rough ride for the crypto market through 2022. In November the market had dropped by 70% from its previous peak at the end of November. Just when the market was getting worse and down, the FTX crash made them look more dire. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many drops in the past. And every time, it’s bounced back with a big rally.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year before hitting a low of $150. But, in 2017 it broke that record and reached a new high of $19,600. Then, in 2018, the price was at $3,100. And in 2020, it broke through the resistance and hit a new high of $68,000 in November 2021. And 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
As we’ve seen in the past, dips tend to be followed by a lengthy bull run that eventually overcomes the resistance set by the previous market’s highest price. This pattern can be seen in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in the last few years. With more and more companies and industries taking to it, its usage and acceptance is growing. From gaming to finance cryptocurrency is being utilized in many ways. This growing demand could lead to more people being involved in the crypto market and, in turn, increase the price.
A rise in the interest of institutions for crypto
In recent times, we’ve seen a growing interest from institutional investors in crypto. From hedge funds to banks, many large institutions are now exploring the possibilities of crypto assets. The increasing interest from institutions could bring more stability to the crypto market and could lead to greater prices.
Regulations of the government
As the crypto market grows as it matures, governments all over the world are beginning to establish more favorable regulations for crypto. This is likely to attract more investors and increase the adoption rate of crypto.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrencies, blockchain, has a wide range of possible applications beyond the realm of financial transactions. In addition to supply chain management, voting and other systems industries are exploring ways they can make use of blockchain technology. This will increase investment and enthusiasm in crypto.
Technologies are constantly evolving.
Blockchain technology and cryptography are at the very beginning of development. As advancements continue to be made in areas like security and scalability, the potential of cryptocurrency assets will continue to increase. This could result in more adoption and higher prices.
Rising global economic uncertainty
In the current economic uncertainty brought on through the COVID-19 pandemic and other factors many investors are beginning to look for safe haven assets like gold and crypto. As the global economic situation is uncertain and uncertain, this could lead to an increase in demand for crypto and higher prices.
Interest from retail investors
Investors from institutions aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, or even individual investors, are also starting to invest in the market for crypto. With increasing numbers of everyday people learn about cryptocurrency and investing in it, this could lead to an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the crypto market is maturing, more and more people are beginning to become aware 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.
mft crypto price
Decentralized finance (DeFi) is an emerging area of the crypto market that enables financial services to be developed on top of blockchain technology. As DeFi expands and more platforms and projects become available, this could lead to increased adoption and more expensive prices for crypto.
Developments in crypto payment methods
As the market for crypto continues to grow as more and more businesses are beginning to accept crypto as a form of payment. This could lead to increased use of crypto in regular transactions, and a rise in prices.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as owned by the state as instruments for investing, are now beginning to explore crypto as an asset class. As more of these funds dedicate a part of their assets to digital currencies, it could lead to increased 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 are beginning to make use of crypto for international transactions, it could result in increased demand and higher costs.
The number of ATMs that accept crypto is increasing.
The number of ATMs for crypto continue to grow it will be easier for individuals to purchase and keep crypto, which will increase demand and price.
Security tokens are developed for development
Security tokens, which are digital assets that signify ownership of an asset, such as stocks or real estate, are a rapidly growing segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, it can lead to a higher demand, and thus higher prices for crypto.
Merchants are more likely to adopt the concept.
In the event that more merchants accept crypto as a means of payment, this will make it more convenient for people to hold and use cryptocurrency, which will drive up demand and prices.
Will crypto be on the grow in 2023? It’s only time to find out. However, with these aspects to consider, it’s likely that the crypto market will see a recovery in 2023. And for those who are looking to invest for the long run patience and discipline will be key.