It’s been a difficult journey for the cryptocurrency market until 2022. In November the market had dropped by more than 70 percent from its previous high at the end of November. And just when things were getting worse after the FTX crash turned them more dire. The question is, can 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. And every time, it’s rebounded with a big rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for more than a year before reaching a bottom of $150. But, in 2017 it broke that record, and hit a new highest of $19,600. Then, in 2018, it was trading at $3,100. And in the year 2020 it struck through the resistance and hit a new peak of $68,000 in the month of November 2021. Just like that, we’ve had another dip. However, the past has proven that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs are usually followed by a lengthy bull run that finally breaks through the resistance created by the previous market’s highest price. This pattern can be seen in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have made significant progress in the last few years. With more and more businesses and industries embracing it, its usage and acceptance is growing. From gaming to finance the use of crypto is increasing in a variety of ways. And this growing use case could result in increasing participation in the market, which in turn could increase the price.
The rise in interest of institutions in crypto
In recent years we’ve witnessed a rising demand from investors of institutional scale in crypto. From banks to hedge funds and even large corporations are starting to explore the possibilities for crypto-based assets. The increased interest of institutions could provide more stability to the market for crypto and lead to higher prices.
As the crypto market grows, governments around the world are beginning to establish 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 underlies the majority of cryptocurrencies, blockchain offers a variety of possible applications beyond just financial transactions. From supply chain management to voting systems, more companies are starting to explore how they can benefit from blockchain technology, which could increase investment and enthusiasm in cryptocurrency.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is still in the early stages of development. As progress is made in areas like security and scalability, potential of cryptocurrency assets will continue to expand. This could result in more use and increase in prices.
Rising global economic uncertainty
In the current economic uncertainty brought on through the COVID-19 pandemic, as well as other causes many investors are starting to look for safe haven assets such as gold and crypto. As the global economic situation is uncertain it could result in more demand for crypto as well as higher prices.
Interest from retail investors
The institutional investors aren’t alone in ones showing interest in crypto. Retail investors, or even individual investors are also beginning to get involved in the cryptocurrency market. With increasing numbers of people become aware of crypto and how to invest in it, this could lead to an increase in demand and consequently higher prices.
The growing awareness and acceptance of crypto
As the market for crypto is maturing, more and more people are starting to learn about it and comprehend it. As the awareness and acceptance of cryptocurrency grows, this could lead to increasing numbers of people purchasing as well as holding the crypto that can increase prices.
The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market that enables the provision of financial services created on top of blockchain technology. As DeFi continues to grow and more projects and platforms are launched, it could lead to increased adoption and higher prices for crypto.
The development of crypto payment methods
As the market for crypto continues to grow, more and more companies are beginning using crypto to be a method of payment. This could lead to increased use of crypto in everyday transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are owned by the state as investments, are now beginning to show interest in cryptocurrency as a possible asset class. As more funds devote a percentage of their portfolio to crypto, this could increase demand and increased prices.
Cryptocurrency is used for international payments
One of the major benefits of cryptocurrency is its ability to facilitate swift and affordable cross-border transactions. As more individuals and businesses start to utilize cryptocurrency for international transactions it could result in increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
With the amount of crypto ATM’s continue to increase it will be more convenient for people to buy and store crypto, which will drive up demand and prices.
Development of security tokens
Security tokens, also known as digital assets that signify ownership in an asset such as real estate or stock are rapidly expanding segment of the cryptocurrency market. As more security tokens are issued and traded, this could lead to increased demand, and thus higher prices for crypto.
More adoption by merchants
As more and more merchants accept crypto as a form of payment, this will make it more convenient for customers to utilize and store cryptocurrency, which will boost demand and increase prices.
So, will crypto rise in 2023? It’s only time to find out. With these things to consider, it’s likely that the crypto market could have a rebound by 2023. And for those who are committed to the long run, being patient and disciplined will be key.