It’s been a tough ride for the crypto market until 2022. By November, the market had dipped by 70% from its previous peak on November 20, 2021. Just when the market was looking down and down, the FTX crash made them look worse. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced many dips in the past. And every time, it’s bounced back with a big rally.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for a full year before hitting a low of $150. But, in 2017, it broke that record and hit a record highest of $19,600. Then, in 2018, the price was at $3,100. And in 2020, the price broke that resistance and hit a new high of $68,000 in November 2021. Just like that, we’ve had another dip. However, history has shown us 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 before, fall-offs are typically followed by a prolonged bull run that eventually surpasses the resistance created by the previous market’s highest price. This pattern is evident in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have progressed a lot in the last few 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 myriad of ways. And this growing use case could result in increasing participation in the crypto market which could increase the price.
A rise in the interest of institutions for cryptocurrency
In the last few years we’ve noticed a growing curiosity from institutions investing in crypto. From hedge funds to banks, many large institutions are beginning to investigate the potential in crypto currencies. This increased interest from institutions could bring more stability to the crypto market and lead to greater prices.
Regulations from the Government
As the crypto market is maturing, governments around the world are starting to create more favorable regulations for crypto. This will help draw more investors and increase the adoption rate of crypto.
A broader range of blockchain applications
The underlying technology behind the majority of cryptocurrencies, blockchain has a wide range of potential use cases that go beyond financial transactions. In addition to supply chain management, voting and other systems and more industries are starting to explore how they can make use of blockchain technology. This could stimulate more investment and excitement in crypto.
Blockchain technology and cryptography are at the very beginning of development. As advancements continue to be made in areas such as security and scalability, the potential of crypto assets will increase. This could lead to greater use and increase in prices.
Global economic uncertainty is growing
Due to the constant economic uncertainty brought on through the COVID-19 pandemic as well as other factors increasing numbers of investors are starting to look for safe haven investments like gold and crypto. Since the economic outlook for the world remains uncertain it could result in increased demand for crypto and increased prices.
Interest from retail investors
Investors from institutions aren’t the only people who are interested in cryptocurrency. Retail investors, also known as individual investors are also beginning to get involved in the cryptocurrency market. As more and more people learn about crypto and the best ways to invest in it, this could lead to increased demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto is maturing increasing numbers of people are beginning to become aware about it and comprehend it. As understanding and acceptance of cryptocurrency grows it could result in more people purchasing and holding crypto, which can drive up prices.
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Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market that enables financial services to be developed using 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 crypto market continues to grow, more and more companies are beginning accepting crypto payments as 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.
More investment from sovereign wealth funds
These funds are owned by the state as investments, are beginning to explore crypto as a potential asset class. As more of these funds devote a percentage or their entire portfolios to cryptocurrency, this could lead to increased demand and increased prices.
Use of crypto for cross-border payments
One of the major benefits of crypto is the ability to make quick and inexpensive cross-border payments. As more businesses and individuals begin to use cryptocurrency for international transactions, this could lead to increased the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
As the number of ATMs that accept crypto continue to increase, it will become easier for people to buy and store cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, also known as digital assets that represent ownership in an asset like stock or real estate, are a rapidly growing segment of the cryptocurrency market. As more security tokens are issued and traded, it could lead to increased demand and consequently higher prices for crypto.
More adoption by merchants
With the increasing number of merchants start accepting cryptocurrency as a method of payment, it will make it easier for consumers to use and hold crypto, which could drive up demand and prices.
So, is crypto likely to rise in 2023? It’s only time to find out. With these things in mind, it’s possible that the crypto market could be able to see a rebound in 2023. If you’re in it for the long haul, being patient and disciplined is crucial.