It’s been a rough ride for the crypto market through 2022. By November, the market had dipped by 70 percent from its previous high at the end of November. When things were looking down, the FTX crash turned them even more dire. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has had its fair share of dips in the past. And every time, it’s rebounded by a massive increase.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for more than a year before reaching a bottom of $150. However, in 2017, it broke that record, and hit a new record high of $19,600. Then, in 2018, it was trading at $3,100. In the year 2020 it struck through that resistance and hit a new high of $68,000 in November 2021. And just like that, we’ve had another dip. But history shows us that following each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips are typically followed by a prolonged bull run, which eventually breaks through the resistance created by the market’s previous highest price. This is evident in more than Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in the last few years. With more and better companies and industries adopting it, its usage and acceptance is growing. From gaming to finance cryptocurrency is being utilized in a myriad of ways. This growing demand can lead to more people being involved in the market and, in turn, increase the price.
A rise in the interest of institutions for crypto
In recent times we’ve noticed a growing interest from institutional investors in crypto. From banks to hedge funds numerous large institutions are starting to explore the potential of crypto assets. This increased interest from institutions could bring more stability to the crypto market and result in more expensive prices.
Government regulations
As the crypto market continues to mature as it matures, governments all over the world are starting to create more favorable regulations for cryptocurrency. This will help draw more investors as well as increase the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that underlies the majority of cryptocurrencies, blockchain is a broad range of possible applications beyond the realm of financial transactions. From supply chain management to voting systems, more industries are beginning to look at ways they can make use of blockchain technology. This will stimulate more investment and excitement in cryptocurrency.
Advancements in technology
Blockchain and cryptocurrency technology is 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 more adoption and higher prices.
Rising global economic uncertainty
In the current economic uncertainty brought on due to the COVID-19 pandemic, as well as other causes many investors are looking for safe haven assets such as bitcoin and even gold. Since the economic outlook for the world remains uncertain it could result in more demand for crypto as well as increased prices.
Interest from retail investors
The institutional investors aren’t alone in people who are interested in cryptocurrency. Retail investors, or even individual investors, are also starting to invest in the cryptocurrency market. With increasing numbers of everyday people become aware of crypto and the best ways to invest in it, this could lead to more demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the crypto market continues to mature increasing numbers of people are starting to learn about it and comprehend it. As understanding and acceptance of cryptocurrency grows, this could lead to increasing numbers of people purchasing or holding cryptocurrency, and this can drive up prices.
props crypto price
Decentralized finance (DeFi) is a rapidly growing area of the crypto market that enables finance services created using blockchain technology. As DeFi expands and more platforms and projects come online, this could lead to increased adoption and higher prices for crypto.
Advances in crypto-based payment methods
As the market for crypto is growing increasing numbers of companies are beginning using crypto to be a method of payment. This could result in 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 owned by the state as instruments for investing, are beginning to explore crypto as an asset class. As more of these funds devote a percentage of their assets to digital currencies, it could increase demand and higher prices.
Use of crypto for cross-border payments
One of the biggest benefits of cryptocurrency is its ability to facilitate quick and inexpensive cross-border payments. As more individuals and businesses are beginning to make use of cryptocurrency for international transactions, it could result in increased the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
The number of ATMs for crypto continue to grow, it will become easier for people to buy and keep crypto, which could drive up demand and prices.
The development of security tokens
Security tokens, or digital assets that are used to represent ownership of an asset, such as real estate or stock, are a rapidly growing segment of the cryptocurrency market. Since more and more security tokens will be issued and traded, this could result in a rise in demand and higher prices for crypto.
A greater adoption rate by merchants
As more and more retailers accept crypto as a form of payment, it will make it more convenient for consumers to hold and use crypto, which could drive up demand and prices.
So, is crypto likely to rise in 2023? The only way to know is time. But with these factors to consider, it’s likely that the crypto market will have a rebound by 2023. For those committed to the long-term patience and discipline is crucial.