It’s been a difficult experience for the crypto market in 2022. In November the market had dropped by more than 70% from its previous peak on November 20, 2021. And just when things were going downhill after the FTX crash turned things worse. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many dips in the past. And every time, it’s rebounded by a massive rally.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for a full year before hitting a low of $150. However, in 2017, it broke the record, and hit a new high of $19,600. Then, in 2018, it was trading at $3,100. In the year 2020 it struck through that resistance and reached a new peak of $68,000 in the month of November 2021. And just like that, we’ve seen another dip. However, the past has proven that following each dip, there’s a bull run.
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 that eventually overcomes the resistance set by the market’s previous highest price. This pattern is evident in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in the last few years. With more and better companies and industries taking to the technology, its use and acceptance is growing. From banking to gaming, crypto is being used in many ways. This growing demand can lead to increasing participation in the market which could boost prices.
Increased institutional interest in crypto
In recent years we’ve witnessed a rising interest from institutional investors in crypto. From hedge funds to banks and even large corporations are beginning to investigate the possibilities in crypto currencies. The increasing interest from institutions could bring more stability to the market for crypto and result in greater prices.
Regulations of the government
As the market for crypto continues to mature, governments around the world are beginning to establish more favorable rules for cryptocurrency. This could help attract more investors and boost the acceptance of crypto in general.
Blockchain has many more applications.
The technology that underlies many cryptocurrencies, blockchain, offers a variety of potential use cases beyond the realm of financial transactions. In addition to supply chain management, voting and other systems companies are exploring ways they can utilize blockchain technology. This could stimulate more investment and excitement in crypto.
Technology advancements
Crypto and blockchain technology are at the very beginning of development. As advances continue to be made in areas like scalability and security, the potential of cryptocurrency assets will continue to increase. This could lead to more adoption and higher prices.
Global economic uncertainty is growing
Due to the constant economic uncertainty brought on by the COVID-19 pandemic, as well as other causes many investors are looking for safe haven assets like cryptocurrency and gold. Because the global economic climate is uncertain, this could lead to more demand for crypto as well as higher prices.
Interest from retail investors
Investors from institutions aren’t the only one who’s showing an interest in crypto. Retail investors, or even individual investors are also beginning to participate in the cryptocurrency market. With increasing numbers of people are educated 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 grows increasing numbers of people are starting to learn about and understand it. As the awareness and acceptance of crypto grows it could result in more people purchasing or holding cryptocurrency, and this can raise prices.
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Decentralized finance (DeFi) is an emerging area of the crypto market that allows the provision of financial services created using blockchain technology. As DeFi expands and more projects and platforms come online, this will lead to a rise in adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the crypto market is growing, more and more companies are starting to accept crypto as a form of payment. This could lead to increased use of crypto in everyday transactions, and a rise in prices.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are government-owned instruments for investing, are now beginning to show interest in crypto as a potential asset class. As more funds dedicate a part or their entire portfolios to cryptocurrency, it could lead to increased demand and increased prices.
Cryptocurrency is used for cross-border payments
One of the major benefits of crypto is the ability to facilitate swift and affordable cross-border transactions. As more and more people and businesses begin to use cryptocurrency for international transactions this could lead to increased demand and higher costs.
Increasing numbers of crypto ATM’s
The number of ATMs for crypto increase it will be more convenient for people to buy and keep cryptocurrency, which can increase demand and price.
Development of security tokens
Security tokens, also known as digital assets that signify ownership of an asset, like real estate or stock is a fast-growing sector of the crypto market. Since more and more security tokens will be issued and traded, this could result in a rise in demand, and thus higher rates for the crypto.
Merchants are more likely to adopt the concept.
As more and more retailers start accepting crypto as a means of payment, this makes it easier for customers to utilize and store cryptocurrency, which will drive up demand and prices.
Will crypto be on the grow in 2023? The only way to know is time. But with these factors to consider, it’s likely that the crypto market could be able to see a rebound in 2023. If you’re looking to invest for the long run Being patient and disciplined is essential.