It’s been a difficult ride for the crypto market until 2022. As of November the market was down by 70 percent from the previous high on November 20, 2021. Just when the market was going downhill, the FTX crash turned them worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced many dips over the years. And every time, it’s bounced back by a massive increase.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for over a year before reaching a bottom of $150. But, in 2017 it broke that record and reached a new high of $19,600. In 2018, it was trading at $3,100. In 2020, it broke through that resistance and reached a new peak of $68,000 in the month of November 2021. Just like that, we’ve witnessed another drop. But history shows us that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs tend to be followed by a long bull run that eventually breaks through the resistance created by the market’s previous highest 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 recent years. With more and better companies and industries taking to the technology, its use and acceptance is growing. From banking to gaming cryptocurrency is being utilized in many ways. And this growing use case could result in more people being involved in the market which could boost prices.
A rise in the interest of institutions for crypto
In the last few years we’ve witnessed a rising demand from investors of institutional scale in crypto. From banks to hedge funds numerous large institutions are now exploring the potential in crypto currencies. The increasing interest from institutions could bring more stability to the crypto market and could lead to greater prices.
As the market for crypto grows as it matures, governments all over the world are beginning to establish more favorable rules for crypto. This will help draw more investors and boost the acceptance of crypto in general.
Blockchain has many more applications.
The technology that underlies many cryptocurrency, blockchain, is a broad range of applications that go beyond the realm of financial transactions. For example, from supply chain management and voting, many and more industries are exploring ways they can benefit from blockchain technology, which could stimulate more investment and excitement in cryptocurrency.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is at the very beginning of development. As advancements continue to be made in areas such as scalability and security, the potential of crypto assets will grow. This could result in more acceptance and higher prices.
Global economic uncertainty is growing
In the current economic uncertainty caused through the COVID-19 pandemic, as well as other causes, more and more investors are beginning to look for safe haven assets like gold and crypto. Because the global economic climate is uncertain and uncertain, this could lead to more demand for crypto as well as more expensive prices.
Interest from retail investors
Investors from institutions aren’t the only people who are interested in cryptocurrency. Retail investors, or even individual investors, are also starting to participate in the crypto market. With increasing numbers of everyday people learn about crypto and how to invest in it This could result in increased demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the crypto market is maturing as more and more people are starting to learn about it and comprehend the concept. As the awareness and acceptance of cryptocurrency grows it could result in more people buying and holding crypto, which can drive up prices.
The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market, which allows the provision of financial services created upon blockchain technology. As DeFi continues to grow and more platforms and projects become available, this could lead to increased adoption and increased prices for crypto.
Developments in crypto payment methods
As the market for crypto grows increasing numbers of companies are starting using crypto to be a method of payment. This could lead to an increase in the use of crypto in everyday transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as state-owned investment vehicles, are beginning to look at crypto as a potential asset class. As more of these funds devote a percentage or their entire portfolios to cryptocurrency, it could increase demand and more expensive prices.
Utilization of crypto to make international payments
One of the major benefits of crypto is its ability to facilitate quick and inexpensive cross-border payments. As more businesses and individuals are beginning to make use of crypto for international transactions, this can lead to a rise in the demand for it and a rise in prices.
An increasing number of crypto ATM’s
With the amount of crypto ATM’s continue to grow, it will become 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 are used to represent ownership of an asset, like stock or real estate, are a rapidly growing area of the crypto market. With the increasing number of security tokens being created and traded, it could result in a rise in demand and higher costs for cryptocurrency.
More adoption by merchants
As more and more merchants begin accepting crypto as a form of payment, it will make it easier for consumers to hold and use crypto, which could drive up demand and prices.
So, will crypto grow in 2023? Only time will tell. With these things in mind, it’s likely that the cryptocurrency market will see a recovery in 2023. And for those who are in it for the long-term, being patient and disciplined will be key.