It’s been a tough ride for the crypto market until 2022. As of November the market had dropped by more than 70 percent from its previous high in November 2021. When things were getting worse after the FTX crash turned them worse. So, will the crypto market recover in 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 rebounded with a huge 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 the record, and hit a new record high of $19,600. In 2018, it was trading at $3,100. In the year 2020 it struck through the resistance, and reached a record peak of $68,000 in the month of November 2021. Just like that, we’ve had another dip. However, the past has proven that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen previously, dips tend to be followed by a prolonged bull run that finally breaks through the resistance created by the previous high price. This is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have 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 gaming to finance, crypto is being used in a variety of ways. This growing demand could lead to increasing participation in the market, which in turn could drive the prices up.
A rise in the interest of institutions for crypto
In recent years we’ve witnessed a rising curiosity from institutions investing in cryptocurrency. From hedge funds to banks, many large institutions are starting to explore the possibilities of crypto assets. The increased interest of institutions could provide more stability to the market for crypto and lead to greater prices.
Regulations of the government
As the market for crypto is maturing as it matures, governments all over the world are starting to create more favorable rules for cryptocurrency. This is likely to attract more investors and increase the mainstream adoption of crypto.
More use cases for blockchain
The technology that is the basis of the majority of cryptocurrencies, blockchain is a broad range of applications that go beyond the realm of financial transactions. For example, from supply chain management and voting, many industries are beginning to look at ways they can make use of blockchain technology. This will increase investment and enthusiasm in crypto.
Blockchain technology and cryptography are still in the beginning stages of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will continue to expand. This could lead to more adoption and higher prices.
Rising global economic uncertainty
In the current economic uncertainty brought on by the COVID-19 pandemic and other factors increasing numbers of investors are looking for safe haven assets like gold and crypto. Since the economic outlook for the world is uncertain and uncertain, this could lead to an increase in demand for crypto and increased prices.
Retail investors are able to earn interest
Institutional investors aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, or individual investors are also beginning to participate in the market for crypto. In the future, as more everyday people become aware of cryptocurrency and investing in it, this could lead to more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto grows increasing numbers of people are beginning to learn about and appreciate the concept. As the awareness and acceptance of crypto grows, this could lead to more people purchasing and holding crypto, which could raise prices.
pulse chain crypto airdrop
Financial decentralization (DeFi) is a rapidly growing area of the crypto market, which allows financial services to be built on top of blockchain technology. As DeFi expands and more projects and platforms come online, this could lead to increased adoption and increased prices for crypto.
Advances in crypto-based payment methods
As the market for crypto continues to grow increasing numbers of companies are starting to accept crypto as a means of payment. This could result in increased use of crypto in regular transactions and higher prices.
The increased investment of sovereign wealth funds
Sovereign wealth funds, which are government-owned investment vehicles, are beginning to look at crypto as an asset class. As more funds allocate a portion or their entire portfolios to cryptocurrency, it could result in a rise in demand and increased prices.
Use of crypto for payment across borders
One of the main advantages of crypto is its capability to perform swift and affordable cross-border transactions. As more businesses and individuals are beginning to make use of crypto for international transactions, it could result in increased demand and higher costs.
The number of ATMs that accept crypto is increasing.
With the amount of crypto ATM’s continue to increase, it will become easier for people to buy and store cryptocurrency, which can boost demand and increase prices.
Development of security tokens
Security tokens, which are digital assets that represent ownership of an asset, such as stock or real estate are rapidly expanding segment of the cryptocurrency market. With the increasing number of security tokens being created and traded, this could result in a rise in demand, and thus higher prices for crypto.
Merchants are more likely to adopt the concept.
As more and more retailers start accepting crypto as a form of payment, this makes it easier for people to use and hold cryptocurrency, which will boost demand and increase prices.
Will crypto be on the increase in 2023? Only time will tell. However, with these aspects being considered, it’s likely that the cryptocurrency market will have a rebound by 2023. For those in it for the long-term, being patient and disciplined will be key.