It’s been a rough journey for the cryptocurrency market until 2022. As of November, the market had dipped by more than 70 percent from its previous high at the end of November. And just when things were going downhill and down, the FTX crash turned them more dire. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had its fair share of dips in the past. Every time, it’s rebounded with a huge rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for a full year before hitting a low of $150. However, in 2017, it broke that record and hit a record high of $19,600. Then, 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. Then, just like that we’ve had another dip. However, history has shown us that following each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips tend to be followed by a long bull run, which eventually overcomes the resistance set by the previous market’s highest price. This is evident in not just 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 embracing the technology, its use and acceptance is growing. From banking to gaming, crypto is being used in a myriad of ways. This growing demand could result in more people being involved in the market which could drive the prices up.
Increased institutional interest in cryptocurrency
In recent times, we’ve seen a growing demand from investors of institutional scale in crypto. From banks to hedge funds, many large institutions are now exploring the potential in crypto currencies. This increased interest from institutions could provide more stability to the crypto market and could lead to higher prices.
Regulations from the Government
As the crypto market 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 and boost the mainstream adoption of crypto.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrency, blockchain, is a broad range of possible applications beyond the realm of financial transactions. For example, from supply chain management and voting, many and more industries are starting to explore how they can benefit from blockchain technology. This will stimulate more investment and excitement in crypto.
Advancements in technology
Blockchain technology and cryptography are still in the beginning stages of development. As progress is made in areas such as security and scalability, potential of crypto assets will grow. This could lead to more use and increase in prices.
Uncertainty in the global economy
Due to the constant economic uncertainty caused due to the COVID-19 pandemic as well as other factors many investors are starting to look for safe haven assets like cryptocurrency and gold. Since the economic outlook for the world remains uncertain, this could lead to increased demand for crypto and more expensive prices.
Interest from retail investors
Institutional investors aren’t the only people who are interested in cryptocurrency. Retail investors, or individual investors, are also starting to participate in the market for crypto. With increasing numbers of everyday people become aware of crypto and how to invest in it this could result in an increase in demand and consequently higher prices.
Growing awareness and acceptance of crypto
As the market for crypto continues to mature increasing numbers of people are beginning to learn about and understand the concept. As understanding and acceptance of crypto grows it could result in more people purchasing and holding crypto, which can drive up prices.
nomic crypto airdrop
The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market that allows finance services created upon blockchain technology. As DeFi expands and more projects and platforms are launched, it will lead to a rise in adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the market for crypto continues to grow, more and more companies are starting accepting crypto payments as a form of payment. This could lead to increased usage of crypto in daily transactions and higher prices.
Increased investment from sovereign wealth funds
These funds are owned by the state as investment vehicles, are beginning to show interest in cryptocurrency as a possible asset class. As more of these funds dedicate a part or their entire portfolios to cryptocurrency, this could result in a rise in demand and higher prices.
Utilization of crypto to make international payments
One of the main advantages of crypto is the capability to perform swift and affordable cross-border transactions. As more and more people and businesses start to utilize cryptocurrency for international transactions it could result in increased the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
With the amount of ATMs for crypto continue to increase it will be easier for individuals to purchase and keep crypto, which will drive up demand and prices.
The development of security tokens
Security tokens, or digital assets that represent ownership in an asset like stocks or real estate is a fast-growing segment of the cryptocurrency market. As more security tokens are issued and traded, it can lead to a higher demand and consequently higher prices for crypto.
More adoption by merchants
With the increasing number of retailers accept crypto as a form of payment, it will make it more convenient for consumers to use and hold crypto, which could drive up demand and prices.
So, will crypto increase in 2023? It’s only time to find out. But with these factors being considered, it’s likely that the crypto market will have a rebound by 2023. For those committed to the long haul patience and discipline is crucial.