It’s been a rough experience for the crypto market through 2022. By November the market was down by more than 70 percent from the previous high on November 20, 2021. When things were looking down after the FTX crash turned things more dire. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has had many dips in the past. Each time, it’s bounced back with a huge increase.
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 highest of $19,600. In 2018, the price was at $3,100. And in the year 2020 it struck through the resistance and hit a new highest of $68,000 in November 2021. And just like that, we’ve witnessed another drop. However, history has shown us that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
As we’ve seen before, fall-offs tend to be followed by a lengthy bull run, which eventually overcomes the resistance set by the market’s previous highest price. This is evident in more than Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in recent years. With more and better companies and industries adopting the technology, its use and acceptance is increasing. From banking to gaming the use of crypto is increasing in a myriad of ways. And this growing use case could lead to more people being involved in the crypto market, which in turn could boost prices.
The rise in interest of institutions in cryptocurrency
In recent times we’ve noticed a growing interest from institutional investors in crypto. From hedge funds to banks and even large corporations are now exploring the potential for crypto-based assets. The increased interest of institutions can bring stability to the crypto market and could lead to more expensive prices.
As the market for crypto continues to mature, governments around the world are starting to create more favorable regulations for crypto. This could help attract more investors as well as increase the acceptance of crypto in general.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrencies, blockchain, offers a variety of potential use cases beyond the realm of financial transactions. From supply chain management to voting systems, more and more industries are starting to explore how they can make use of blockchain technology. This could increase investment and enthusiasm in crypto.
Technologies are constantly evolving.
Crypto and blockchain technology are at the very beginning of development. As advancements continue to be made in areas such as security and scalability, the potential of cryptocurrency assets will continue to increase. This could lead to more use and increase in prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty brought on due to the COVID-19 pandemic and other factors, more and more investors are beginning to look for safe haven assets such as gold and crypto. Because the global economic climate remains uncertain, this could lead to increased demand for crypto and higher prices.
Interest from retail investors
Institutional investors aren’t the only one who’s showing an interest in crypto. Retail investors, or even individual investors are also beginning to participate in the market for crypto. In the future, as more everyday people become aware of crypto and the best ways to invest in it this could result in an increase in demand and consequently higher prices.
The growing awareness and acceptance of crypto
As the market for crypto continues to mature increasing numbers of people are beginning to learn about and appreciate it. As understanding and acceptance grows of crypto, this could lead to more people purchasing and holding crypto, which can increase prices.
military finance crypto price
Decentralized finance (DeFi) is a rapidly growing area of the crypto market, which allows the provision of financial services developed upon blockchain technology. As DeFi expands and more projects and platforms come online, this could lead to increased adoption and more expensive prices for crypto.
Developments in crypto payment methods
As the crypto market is growing as more and more businesses are beginning accepting crypto payments as a form of payment. This could lead to increased usage of crypto in daily transactions, and a rise in prices.
More investment from sovereign wealth funds
These funds are state-owned instruments for investing, are now beginning to look at cryptocurrency as a possible asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, this could lead to increased demand and higher prices.
Cryptocurrency is used for payment across borders
One of the main advantages of cryptocurrency is its capability to perform fast and cheap cross-border payments. As more businesses and individuals are beginning to make use of cryptocurrency for international transactions this can lead to a rise in demand and higher costs.
An increasing number of crypto ATM’s
With the amount of ATMs that accept crypto continue to increase it will be easier for consumers to purchase and hold crypto, which will boost demand and increase prices.
Security tokens are developed for development
Security tokens, also known as digital assets that represent ownership in an asset like stocks or real estate is a fast-growing area of the crypto market. With the increasing number of security tokens being created and traded, this could result in a rise in demand and higher costs for cryptocurrency.
More adoption by merchants
With the increasing number of retailers start accepting crypto as a form of payment, this makes it easier for people to hold and use crypto, which can increase demand and price.
Will crypto be on the increase in 2023? Only time will tell. With these things in mind, it’s likely that the crypto market will have a rebound by 2023. And for those who are looking to invest for the long run Being patient and disciplined will be key.