It’s been a rough journey for the cryptocurrency market until 2022. As of November the market had dropped by 70 percent from the previous high in November 2021. Just when the market was going downhill and down, the FTX crash turned them worse. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen its fair share of dips in the past. Each time, it’s bounced back with a huge rise.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year before reaching a bottom of $150. However, in 2017 it broke that record and hit a record record high of $19,600. Fast forward to 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. Just like that, we’ve had another dip. However, history has shown us that after each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen previously, dips are usually followed by a long bull run, which eventually overcomes the resistance set by the previous high price. This pattern is evident in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has made significant progress in the last few years. With more and better companies and industries embracing the technology, its use and acceptance is growing. From finance to gaming cryptocurrency is being utilized in a myriad of ways. And this growing use case could lead to more people being involved in the market, which in turn could drive the prices up.
A rise in the interest of institutions for crypto
In recent times we’ve noticed a growing demand from investors of institutional scale in cryptocurrency. From hedge funds to banks numerous large institutions are now exploring the potential in crypto currencies. The increased interest of institutions can bring stability to the crypto market and could lead to greater prices.
Regulations of the government
As the market for crypto grows, governments around the world are beginning to establish more favorable rules for crypto. This could help attract more investors and increase the acceptance of crypto in general.
A broader range of blockchain applications
The technology that is the basis of the majority of cryptocurrencies, blockchain offers a variety of possible applications beyond just financial transactions. For example, from supply chain management and voting, many and more industries are beginning to look at ways they can utilize blockchain technology, which could drive more investment and interest in crypto.
Technology advancements
Crypto and blockchain technology are still in the early stages of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will continue to increase. This could lead to greater acceptance and higher prices.
Uncertainty in the global economy
In the current economic uncertainty caused by the COVID-19 pandemic and other factors increasing numbers of investors are beginning to look for safe haven assets such as bitcoin and even gold. Since the economic outlook for the world remains uncertain, this could lead to an increase in demand for crypto and more expensive prices.
Retail investors are able to earn interest
Institutional investors aren’t the only people who are interested in cryptocurrency. Retail investors, or even individual investors are also beginning to participate in the market for crypto. As more and more people learn about crypto and the best ways to invest in it This could result in more demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the crypto market continues to mature, more and more people are starting to learn about it and comprehend the concept. As awareness and acceptance of crypto grows, it will lead to more people buying or holding cryptocurrency, and this could increase prices.
polkamon crypto price
Financial decentralization (DeFi) is an emerging area of the crypto market that enables financial services to be built upon blockchain technology. As DeFi continues to grow and more projects and platforms are launched, it will lead to a rise in adoption and increased prices for crypto.
The development of crypto payment methods
As the market for crypto continues to grow as more and more businesses are starting to accept crypto as a form 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
The sovereign wealth fund, also known as government-owned investment vehicles, are now beginning to explore crypto as an asset class. As more funds allocate a portion or their entire portfolios to cryptocurrency, this could increase demand and more expensive prices.
Cryptocurrency is used for cross-border payments
One of the main advantages of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more businesses and individuals start to utilize cryptocurrency for international transactions this could lead to increased demand and higher costs.
Increasing numbers of crypto ATM’s
With the amount of crypto ATM’s continue to grow, it will become easier for individuals to purchase and keep cryptocurrency, which can drive up demand and prices.
The development of security tokens
Security tokens, also known as digital assets that represent ownership in an asset like real estate or stock are rapidly expanding area of the crypto market. Since more and more security tokens will be created and traded, this could result in a rise in demand and consequently higher rates for the crypto.
A greater adoption rate by merchants
With the increasing number of merchants start accepting crypto as a means of payment, it will make it more convenient for consumers to utilize and store cryptocurrency, which will increase demand and price.
So, will crypto grow in 2023? The only way to know is time. But with these factors to consider, it’s likely that the cryptocurrency market will see a recovery in 2023. For those looking to invest for the long haul, being patient and disciplined will be key.