It’s been a tough journey for the cryptocurrency market in 2022. By November the market had dropped by 70 percent from its previous high at the end of November. Just when the market was getting worse and down, the FTX crash made them look even worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen its fair share of drops in the past. And every time, it’s rebounded with a big increase.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for more than a year before reaching a bottom of $150. But, in 2017 it broke that record, and hit a new high of $19,600. Fast forward to 2018, it was trading at $3,100. And in 2020, it broke through that resistance and hit a new peak of $68,000 in the month of November 2021. Just like that, we’ve witnessed another drop. However, the past has proven that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs are typically followed by a long bull run that eventually overcomes the resistance set by the previous market’s highest price. This is evident not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has made significant progress in recent years. With more and more companies and industries adopting it, its usage and acceptance is growing. From gaming to finance, crypto is being used in a myriad of ways. And this growing use case could lead to more people getting involved in the crypto market which could drive the prices up.
The rise in interest of institutions in crypto
In the last few years, we’ve seen a growing demand from investors of institutional scale in cryptocurrency. From banks to hedge funds, many large institutions are starting to explore the possibilities in crypto currencies. The increased interest of institutions can bring stability to the market for crypto and lead to higher prices.
Regulations of the government
As the crypto market continues to mature and mature, governments across the globe are beginning to establish more favorable regulations for cryptocurrency. This is likely to attract more investors as well as increase the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrencies, blockchain, offers a variety of potential use cases that go beyond financial transactions. For example, from supply chain management and voting, many companies are starting to explore how they can benefit from blockchain technology. This could stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Blockchain technology and cryptography are 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 lead to greater acceptance and higher prices.
Uncertainty in the global economy
With the ongoing economic uncertainty caused by the COVID-19 pandemic, as well as other causes many investors are starting to look for safe haven assets such as bitcoin and even gold. Because the global economic climate is uncertain and uncertain, this could lead to increased demand for crypto and more expensive prices.
Interest from retail investors
Institutional investors aren’t the only one who’s showing an interest in crypto. Retail investors, or even individual investors, are also starting to participate in the cryptocurrency market. In the future, as more people become aware of crypto and the best ways to invest in it, this could lead to an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting crypto
As the crypto market is maturing increasing numbers of people are starting to learn about and understand it. As understanding and acceptance of cryptocurrency grows, it will lead to increasing numbers of people purchasing and holding crypto, which could raise prices.
osmosis crypto airdrop
Decentralized finance (DeFi) is a rapidly growing area of the crypto market, which allows financial services to be built on top of blockchain technology. As DeFi expands and more projects and platforms are launched, it could result in increased use and increased prices for crypto.
Developments in crypto payment methods
As the market for crypto grows, more and more companies are beginning using crypto to be a means of payment. This could lead to an increase in the use of crypto in everyday transactions, and a rise in prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned investment vehicles, are starting to look at crypto as an asset class. As more funds devote a percentage of their assets to digital currencies, this could increase demand and more expensive prices.
Utilization of crypto to make cross-border payments
One of the major benefits of crypto is its ability to facilitate quick and inexpensive cross-border payments. As more businesses and individuals start to utilize crypto for international transactions, this can lead to a rise in demand and higher costs.
An increasing number of crypto ATM’s
With the amount of ATMs that accept crypto continue to grow it will be more convenient for individuals to purchase and hold crypto, which could increase demand and price.
Development of security tokens
Security tokens, or digital assets that represent ownership of an asset, like real estate or stock is a fast-growing segment of the cryptocurrency market. Since more and more security tokens will be created and traded, this can lead to a higher demand and higher costs for cryptocurrency.
Merchants are more likely to adopt the concept.
In the event that more merchants begin accepting crypto as a means of payment, this will make it easier for customers to utilize and store crypto, which could boost demand and increase prices.
So, is crypto likely to increase in 2023? It’s only time to find out. But with these factors in mind, it’s possible that the crypto market will be able to see a rebound in 2023. For those in it for the long run, being patient and disciplined is essential.