It’s been a rough experience for the crypto market through 2022. As of November the market was down by 70% from its previous peak at the end of November. When things were getting worse, the FTX crash turned things more dire. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had its fair share of dips over the years. And every time, it’s rebounded with a huge rise.
For instance, in 2013, Bitcoin reached a peak of $1,160, then fell for more than a year, reaching a low of $150. However, in 2017, it broke that record and hit a record highest of $19,600. Fast forward to 2018, it was trading at $3,100. And in the year 2020 it struck through the resistance and hit 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
As we’ve seen previously, dips are typically followed by a long bull run that finally surpasses the resistance created by the market’s previous highest price. This is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in the last few years. With more and more businesses and industries taking to it, its usage and acceptance is rising. From banking to gaming the use of crypto is increasing in many ways. And this growing use case could lead to more people getting involved in the crypto market, which in turn could increase the price.
Increased institutional interest in crypto
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 now exploring the potential of crypto assets. The increased interest of institutions could bring more stability to the crypto market and could lead to more expensive prices.
Regulations from the Government
As the market for crypto grows and mature, governments across the globe are starting to create more favorable regulations for crypto. This will help draw more investors as well as increase the adoption rate of crypto.
A broader range of blockchain applications
The technology that is the basis of the majority of cryptocurrencies, blockchain is a broad range of applications that go that go beyond financial transactions. From supply chain management to voting systems, more companies are starting to explore how they can benefit from blockchain technology. This could drive more investment and interest in cryptocurrency.
Technology advancements
Blockchain technology and cryptography 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 acceptance 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 factors, more and more investors are beginning to look for safe haven assets such as gold and crypto. Since the economic outlook for the world remains uncertain it could result in an increase in demand for crypto and increased prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only one who’s showing an interest in crypto. Retail investors, or individual investors are also beginning to invest in the market for crypto. With increasing numbers of people learn about crypto and how to invest in it, this could lead to an increase in demand and consequently higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto grows as more and more people are beginning to learn about and understand the concept. As understanding and acceptance of crypto grows it could result in more people purchasing or holding cryptocurrency, and this could raise prices.
pontem crypto
Financial decentralization (DeFi) is an emerging area of the crypto market, which allows financial services to be created using blockchain technology. As DeFi grows and more projects and platforms come online, this will lead to a rise in adoption and more expensive prices for crypto.
The development of crypto payment methods
As the crypto market continues to grow as more and more businesses are beginning accepting crypto payments as a form of payment. This could lead to increased usage of crypto in daily transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
These funds are owned by the state as investment vehicles, are starting to look at cryptocurrency as a possible asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, it could increase demand and increased prices.
Utilization of crypto to make cross-border payments
One of the major benefits of crypto is its ability to make quick and inexpensive cross-border payments. As more individuals and businesses start to utilize 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 continue to increase it will be easier for consumers to purchase and store crypto, which could increase demand and price.
Development of security tokens
Security tokens, also known as digital assets that are used to represent ownership of an asset, like stock or real estate is a fast-growing area of the crypto market. With the increasing number of security tokens being created and traded, it could result in a rise in demand, and thus higher costs for cryptocurrency.
A greater adoption rate by merchants
In the event that more businesses start accepting crypto as a form of payment, it will make it more convenient for customers to utilize and store crypto, which could drive up demand and prices.
Will crypto be on the increase in 2023? It’s only time to find out. But with these factors to consider, it’s possible that the crypto market will be able to see a rebound in 2023. For those in it for the long-term, being patient and disciplined is crucial.