It’s been a difficult journey for the cryptocurrency market until 2022. In November the market was down by more than 70% from its previous peak in November 2021. And just when things were getting worse and down, the FTX crash turned things even more dire. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen its fair share of dips over the years. Every time, it has bounced back by a massive rise.
For instance, in 2013, Bitcoin reached a peak of $1,160, then fell for a full year, reaching a low of $150. However, in 2017, it broke that record and reached a new 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 hit a new highest of $68,000 in November 2021. Just like that, we’ve witnessed another drop. However, history has shown us that following each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
As we’ve seen before, fall-offs tend to be followed by a prolonged bull run, which eventually surpasses the resistance created by the market’s previous highest price. This pattern is evident in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in recent years. With more and more businesses and industries adopting the technology, its use and acceptance is rising. From banking to gaming, crypto is being used in a variety of ways. And this growing use case could result in more people being involved in the market and, in turn, boost prices.
Increased institutional interest in crypto
In recent times, we’ve seen a growing demand from investors of institutional scale in crypto. From banks to hedge funds, many large institutions are starting to explore the possibilities in crypto currencies. The increased interest of institutions could provide more stability to the market for crypto and could lead to higher prices.
Regulations from the Government
As the market for crypto continues to mature and mature, governments across the globe are beginning to establish more favorable regulations for cryptocurrency. This is likely to attract more investors as well as increase the acceptance of crypto in general.
Blockchain has many more applications.
The underlying technology behind many cryptocurrencies, blockchain, is a broad range of possible applications beyond just financial transactions. In addition to supply chain management, voting and other systems industries are beginning to look at ways they can make use of blockchain technology, which could stimulate more investment and excitement in cryptocurrency.
Technology advancements
Blockchain and cryptocurrency technology is still in the beginning stages of development. As progress is made in areas such as security and scalability, potential of crypto assets will continue to increase. This could lead to more adoption and higher prices.
Uncertainty in the global economy
With the ongoing economic uncertainty caused by the COVID-19 pandemic and other factors many investors are starting to look for safe haven assets such as bitcoin and even gold. As the global economic situation remains uncertain, this could lead to increased demand for crypto and more expensive prices.
Retail investors are able to earn interest
Institutional investors aren’t the only ones showing interest in crypto. Retail investors, or individual investors, are also starting to invest in the cryptocurrency market. As more and more everyday people become aware of crypto and how to invest in it This could result in increased demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the crypto market grows increasing numbers of people are beginning to become aware about and appreciate the concept. As understanding and acceptance of crypto grows, this could lead to more people purchasing as well as holding the crypto that can drive up prices.
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The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market that allows finance services developed using blockchain technology. As DeFi grows and more platforms and projects come online, this could result in increased use and increased prices for crypto.
The development of crypto payment methods
As the market for crypto is growing increasing numbers of companies are beginning accepting crypto payments as a method of payment. This could lead to an increase in the use of crypto in everyday transactions and higher prices.
The increased investment of sovereign wealth funds
Sovereign wealth funds, which are owned by the state as investment vehicles, are starting to look at crypto as an asset class. As more of these funds allocate a portion of their portfolio to crypto, this could increase demand and more expensive prices.
Utilization of crypto to make cross-border payments
One of the major benefits of cryptocurrency is its ability to make quick and inexpensive cross-border payments. As more individuals and businesses are beginning to make use of cryptocurrency for international transactions, this can lead to a rise in the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
The number of ATMs that accept crypto continue to increase it will be easier for consumers to purchase and hold crypto, which will boost demand and increase prices.
Security tokens are developed for development
Security tokens, also known as digital assets that are used to represent ownership in an asset like stock or real estate are rapidly expanding sector of the crypto market. As more security tokens are issued and traded, it can lead to a higher demand and higher rates for the crypto.
A greater adoption rate by merchants
In the event that more merchants start accepting crypto as a means of payment, it will make it more convenient for customers to utilize and store crypto, which could drive up demand and prices.
So, is crypto likely to grow in 2023? Only time will tell. But with these factors in mind, it’s possible that the crypto market could be able to see a rebound in 2023. If you’re committed to the long-term Being patient and disciplined is essential.