It’s been a tough journey for the cryptocurrency market through 2022. As of November the market had dropped by 70 percent from the previous high at the end of November. When things were going downhill after the FTX crash turned things even worse. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced many dips over the years. Each time, it’s bounced back by a massive increase.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for more than a year before hitting a low of $150. However, in 2017, it broke the record and hit a record high of $19,600. Then, in 2018, and it was trading at $3,100. In 2020, the price broke through that resistance and hit a new high of $68,000 in November 2021. Just like that, we’ve seen another dip. But history shows us 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 previously, dips are typically followed by a long bull run, which eventually breaks through the resistance created by the previous high price. This pattern can be seen in more than Bitcoin but also in 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 more businesses and industries adopting it, its usage and acceptance is increasing. From banking to gaming, crypto is being used in a variety of ways. The growing popularity of crypto could result in increasing participation in the crypto market which could increase the price.
Increased institutional interest in cryptocurrency
In recent times, we’ve seen a growing curiosity from institutions investing in crypto. From hedge funds to banks, many large institutions are beginning to investigate the possibilities in crypto currencies. The increased interest of institutions could bring more stability to the crypto market and result in higher prices.
Regulations of the government
As the market for crypto grows, governments around the world are starting to create more favorable regulations for crypto. This will help draw more investors and boost the acceptance of crypto in general.
A broader range of blockchain applications
The technology that underlies many cryptocurrency, blockchain, offers a variety of applications that go that go beyond financial transactions. For example, from supply chain management and voting, many industries are starting to explore how they can make use of blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Technology advancements
Crypto and blockchain technology are still in the early stages of development. As advances continue to be made in areas such as security and scalability, potential of crypto assets will continue to expand. This could lead to more acceptance and higher prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty caused due to the COVID-19 pandemic, as well as other causes many investors are starting to look for safe haven assets such as cryptocurrency and gold. Since the economic outlook for the world remains uncertain and uncertain, this could lead to increased demand for crypto and increased prices.
Interest from retail investors
Institutional investors aren’t the only people who are interested in cryptocurrency. Retail investors, or individual investors are also beginning to get involved in the crypto market. In the future, as more everyday people become aware of cryptocurrency and investing in it This could result in more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto grows increasing numbers of people are beginning to learn about it and comprehend the concept. As awareness and acceptance of crypto grows, it will lead to increasing numbers of people purchasing or holding cryptocurrency, and this could increase prices.
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Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market that allows the provision of financial services created upon blockchain technology. As DeFi continues to grow and more projects and platforms come online, this will lead to a rise in adoption and increased prices for crypto.
Developments in crypto payment methods
As the market for crypto is growing as more and more businesses are beginning to accept crypto as a means of payment. This could result in increased 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 investments, are starting to explore cryptocurrency as a possible asset class. As more of these funds allocate a portion of their portfolio to crypto, this could result in a rise in demand and more expensive prices.
Use of crypto for cross-border payments
One of the major benefits of crypto is its capability to perform fast and cheap cross-border payments. As more and more people and businesses are beginning to make use of cryptocurrency for international transactions this could lead to increased demand and higher costs.
The number of ATMs that accept crypto is increasing.
With the amount of ATMs for crypto continue to increase it will be easier for consumers to purchase and store crypto, which will increase demand and price.
The development of security tokens
Security tokens, also known as digital assets that are used to represent ownership of an asset, like real estate or stock are rapidly expanding sector of the crypto market. As more security tokens are issued and traded, it can lead to a higher demand and higher prices for crypto.
A greater adoption rate by merchants
As more and more businesses accept cryptocurrency as a method of payment, it makes it easier for consumers to hold and use crypto, which could drive up demand and prices.
Will crypto be on the grow in 2023? Only time will tell. But with these factors in mind, it’s likely that the cryptocurrency market will see a recovery in 2023. If you’re committed to the long haul Being patient and disciplined is crucial.