It’s been a rough experience for the crypto market in 2022. In November the market was down by more than 70 percent from its previous high at the end of November. When things were going downhill and down, the FTX crash turned them worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has had many dips in the past. Each time, it’s rebounded with a big rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for a full year before hitting a low of $150. In 2017 it broke that record and hit a record highest of $19,600. In 2018, it was trading at $3,100. In the year 2020 it struck through the resistance and reached a new highest of $68,000 in November 2021. And just like that, we’ve had another dip. However, the past has proven that at the end of every dip the bull runs.
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, which eventually surpasses the resistance created by the market’s previous highest price. This is evident not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in recent years. With more and more companies and industries adopting it, its usage and acceptance is increasing. From banking to gaming the use of crypto is increasing in a variety of ways. This growing demand can lead to more people being involved in the market and, in turn, increase the price.
Increased institutional interest in cryptocurrency
In the last few 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 of crypto assets. The increased interest of institutions could provide more stability to the market for crypto and could lead to more expensive prices.
Regulations of the government
As the market for crypto continues to mature 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 adoption rate of crypto.
More use cases for blockchain
The underlying technology behind the majority of cryptocurrencies, blockchain has a wide range of possible applications that go beyond financial transactions. For example, from supply chain management and voting, many industries are exploring ways they can benefit from blockchain technology. This could increase investment and enthusiasm in cryptocurrency.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is still in the beginning stages of development. As progress is made in areas like security and scalability, potential of crypto assets will grow. This could lead to more adoption and higher prices.
Rising global economic uncertainty
With the ongoing economic uncertainty caused through the COVID-19 pandemic as well as other factors, more and more investors are looking for safe haven assets such as gold and crypto. Because the global economic climate remains uncertain it could result in an increase in demand for crypto and increased prices.
Interest from retail investors
Investors from institutions aren’t the only people who are interested in crypto. Retail investors, or individual investors, are also starting to get involved in the crypto market. As more and more people learn about crypto and how to invest in it This could result in increased demand and higher prices.
The growing awareness and acceptance of crypto
As the market for crypto is maturing as more and more people are beginning to learn about and understand the concept. As awareness and acceptance of crypto grows, it will lead to more people buying or holding cryptocurrency, and this could raise prices.
palladium financial crypto
The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market that enables financial services to be developed on top of blockchain technology. As DeFi expands and more projects and platforms become available, this could lead to increased adoption and increased prices for crypto.
Advances in crypto-based payment methods
As the market for crypto is growing as more and more businesses are beginning to accept crypto as a form of payment. This could lead to increased use of crypto in everyday transactions and higher prices.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned investments, are starting to explore crypto as an asset class. As more funds devote a percentage of their assets to digital currencies, this could increase demand and higher prices.
Cryptocurrency is used for cross-border payments
One of the biggest benefits of crypto is its capability to perform 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 prices.
The number of ATMs that accept crypto is increasing.
The number of crypto ATM’s continue to increase it will be more convenient for individuals to purchase and store crypto, which will drive up demand and prices.
Security tokens are developed for development
Security tokens, which are digital assets that signify ownership in an asset like stock or real estate is a fast-growing segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, it could result in a rise in demand and consequently higher costs for cryptocurrency.
A greater adoption rate by merchants
As more and more businesses accept crypto as a form of payment, it will make it more convenient for people to utilize and store crypto, which could drive up demand and prices.
Will crypto be on the rise in 2023? Only time will tell. However, with these aspects being considered, it’s possible that the crypto market will be able to see a rebound in 2023. And for those who are looking to invest for the long haul patience and discipline is crucial.