It’s been a rough experience for the crypto market until 2022. As of November, the market had dipped by more than 70 percent from the previous high at the end of November. When things were looking down after the FTX crash turned things more dire. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has had many dips over the years. And every time, it’s bounced back 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. In 2017 it broke that record and reached a new record high of $19,600. Then, in 2018, the price was at $3,100. In 2020, it broke that resistance and reached a new highest of $68,000 in November 2021. Just like that, we’ve witnessed another drop. But history shows us that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen previously, dips are usually followed by a prolonged bull run that eventually breaks through the resistance created by the previous market’s highest price. This pattern can be seen in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has made significant progress in recent years. With more and better companies and industries taking to the technology, its use and acceptance is rising. From finance to gaming, crypto is being used in many ways. And this growing use case could result in more people getting involved in the crypto market and, in turn, drive the prices up.
A rise in the interest of institutions for cryptocurrency
In recent years, we’ve seen a growing curiosity from institutions investing in cryptocurrency. From banks to hedge funds, many large institutions are now exploring the potential for crypto-based assets. This increased interest from institutions can bring stability to the crypto market and could lead to greater prices.
Regulations from the Government
As the market for crypto grows and mature, governments across the globe are beginning to develop more favorable rules for crypto. This is likely to attract more investors as well as increase the acceptance of crypto in general.
A broader range of blockchain applications
The technology that underlies many cryptocurrencies, blockchain, is a broad range of possible applications beyond the realm of financial transactions. From supply chain management to voting systems, more and more industries are starting to explore how they can utilize blockchain technology, which could drive more investment and interest in cryptocurrency.
Technology advancements
Blockchain technology and cryptography are still in the beginning stages of development. As advances continue to be made in areas like security and scalability, the potential of cryptocurrency assets will continue to expand. This could result in more use and increase in prices.
Rising global economic uncertainty
With the ongoing economic uncertainty brought on through the COVID-19 pandemic and other factors, more and more investors are starting to look for safe haven assets like gold and crypto. As the global economic situation is uncertain and uncertain, this could lead to increased 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 crypto. Retail investors, also known as individual investors, are also starting to invest in the cryptocurrency market. As more and more people are educated about crypto and the best ways to invest in it this could result in an increase in demand and consequently higher prices.
The growing awareness and acceptance of cryptocurrency
As the crypto market is maturing, more and more people are beginning to learn about and appreciate the concept. As the awareness and acceptance of crypto grows, this could lead to more people buying and holding crypto, which could drive up prices.
red crypto
Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market that allows the provision of financial services built using blockchain technology. As DeFi continues to grow and more projects and platforms come online, this could result in increased use and more expensive prices for crypto.
Advances in crypto-based payment methods
As the crypto market continues to grow as more and more businesses are starting using crypto to be a form of payment. This could lead to an increase in the usage of crypto in daily transactions and higher prices.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as owned by the state as instruments for investing, are now beginning to explore 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 more expensive prices.
Use of crypto for international payments
One of the main advantages of crypto is its capability to perform fast and cheap cross-border payments. As more individuals and businesses are beginning to make use of cryptocurrency for international transactions, this could lead to increased demand and higher prices.
An increasing number of crypto ATM’s
As the number of crypto ATM’s increase it will be easier for individuals to purchase and hold crypto, which will increase demand and price.
Security tokens are developed for development
Security tokens, which are digital assets that represent ownership of an asset, such as stocks or real estate is a fast-growing sector of the crypto market. As more security tokens are created and traded, it could lead to increased demand and higher prices for crypto.
Merchants are more likely to adopt the concept.
In the event that more businesses begin accepting crypto as a form of payment, it will make it more convenient for customers to utilize and store crypto, which can increase demand and price.
So, is crypto likely to rise in 2023? The only way to know is time. However, with these aspects in mind, it’s likely that the cryptocurrency market will have a rebound by 2023. And for those who are in it for the long haul Being patient and disciplined is crucial.