It’s been a tough ride for the crypto market through 2022. By November, the market had dipped by 70 percent from the previous high on November 20, 2021. Just when the market was getting worse after the FTX crash made them look even worse. What is the likelihood that the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had many dips over the years. Every time, it’s bounced back with a big rally.
For instance, in 2013, Bitcoin reached a peak of $1,160, then fell for a full year, reaching a low of $150. However, in 2017, it broke the record and reached a new record high of $19,600. Then, in 2018, and it was trading at $3,100. And in the year 2020 it struck that resistance, and reached a record highest of $68,000 in November 2021. And just like that, we’ve witnessed another drop. However, history has shown 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 usually followed by a long bull run that finally surpasses the resistance created by the market’s previous highest price. This pattern can be seen in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in the last few years. With more and more businesses and industries adopting the technology, its use and acceptance is increasing. From gaming to finance cryptocurrency is being utilized in many ways. This growing demand could lead to increasing participation in the crypto market, which in turn could increase the price.
Increased institutional interest in crypto
In recent years we’ve noticed a growing interest from institutional investors in cryptocurrency. From hedge funds to banks numerous large institutions are starting to explore the possibilities for crypto-based assets. The increased interest of institutions could bring more stability to the crypto market and could lead to more expensive prices.
Regulations of the government
As the crypto market grows as it matures, governments all over the world are beginning to develop more favorable rules for cryptocurrency. This could help attract more investors and boost the adoption rate of crypto.
More use cases for blockchain
The technology that is the basis of the majority of cryptocurrencies, blockchain is a broad range of possible applications beyond the realm of financial transactions. In addition to supply chain management, voting and other systems and more industries are exploring ways they can utilize blockchain technology. This could increase investment and enthusiasm in cryptocurrency.
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 greater adoption and higher prices.
Uncertainty in the global economy
Due to the constant economic uncertainty brought on through the COVID-19 pandemic, as well as other causes increasing numbers of investors are starting to look for safe haven assets like bitcoin and even gold. As the global economic situation remains uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Interest from retail investors
Institutional investors aren’t the only ones showing interest in crypto. Retail investors, also known as individual investors are also beginning to invest in the market for crypto. As more and more everyday people become aware of crypto and the best ways to invest in it This could result in increased demand and higher prices.
Growing awareness and acceptance of crypto
As the market for crypto is maturing as more and more people are beginning to learn about and appreciate the concept. As the awareness and acceptance grows of crypto it could result in more people buying as well as holding the crypto that can increase prices.
moving crypto from coinbase to binance
The Decentralized Finance (DeFi) is an emerging area of the crypto market that allows the provision of financial services built using blockchain technology. As DeFi grows and more platforms and projects are launched, it could lead to increased adoption and increased prices for crypto.
The development of crypto payment methods
As the market for crypto continues to grow increasing numbers of companies are starting to accept crypto as a form of payment. This could result in increased usage of crypto in daily transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are state-owned investments, are beginning to explore crypto as a potential asset class. As more funds dedicate a part of their portfolio to crypto, this could lead to increased demand and more expensive prices.
Utilization of crypto to make payment across borders
One of the biggest benefits of crypto is its ability to make swift and affordable cross-border transactions. As more and more people and businesses begin to use crypto for international transactions, this can lead to a rise in the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
The number of crypto ATM’s continue to increase it will be easier for individuals to purchase and store crypto, which could drive up demand and prices.
Security tokens are developed for development
Security tokens, which are digital assets that represent ownership of an asset, like stock or real estate is a fast-growing area of the crypto market. As more security tokens are issued and traded, this can lead to a higher demand, and thus higher rates for the crypto.
More adoption by merchants
With the increasing number of retailers accept cryptocurrency as a method of payment, it will make it more convenient for consumers to utilize and store cryptocurrency, which will boost demand and increase prices.
So, is crypto likely to increase in 2023? Only time will tell. With these things to consider, it’s possible that the crypto market could see a recovery in 2023. For those in it for the long-term, being patient and disciplined will be key.