It’s been a tough ride for the crypto market through 2022. By November, the market had dipped by 70 percent from the previous high at the end of November. When things were looking down after the FTX crash turned them even more dire. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had its fair share of dips in the past. Each time, it’s bounced back with a big rise.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for a full year before hitting a low of $150. However, in 2017, it broke that record, and hit a new record high of $19,600. Fast forward to 2018, and it was trading at $3,100. And in 2020, the price broke that resistance and hit a new peak of $68,000 in the month of November 2021. Then, just like that we’ve had another dip. However, the past has proven that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs tend to be followed by a lengthy bull run that finally overcomes the resistance set by the previous high 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 progressed a lot in the last few years. With more and more businesses and industries adopting the technology, its use and acceptance is increasing. From finance to gaming, crypto is being used in many ways. And this growing use case could result in increasing participation in the market, which in turn could boost prices.
Increased institutional interest in crypto
In recent times we’ve witnessed a rising interest from institutional investors in crypto. From hedge funds to banks numerous large institutions are now exploring the potential for crypto-based assets. This increased interest from institutions could bring more stability to the crypto market and result in more expensive prices.
Regulations from the Government
As the crypto market continues to mature, governments around the world are beginning to establish more favorable rules for crypto. This is likely to attract more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The technology that is the basis of the majority of cryptocurrencies, blockchain has a wide range of possible applications beyond just financial transactions. For example, from supply chain management and voting, many and more industries are beginning to look at ways they can utilize blockchain technology. This will drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Blockchain technology and cryptography are still in the early stages of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will continue to increase. This could lead to more acceptance and higher prices.
Global economic uncertainty is growing
With the ongoing instability in the economy caused by the COVID-19 pandemic, as well as other causes increasing numbers of investors are beginning to look for safe haven investments like cryptocurrency and gold. Since the economic outlook for the world is uncertain it could result in an increase in demand for crypto and more expensive prices.
Interest from retail investors
The institutional investors aren’t alone in ones showing interest in cryptocurrency. Retail investors, or even individual investors, are also starting to invest in the crypto market. With increasing numbers of everyday people become aware of crypto and the best ways to invest in it this could result in more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto is maturing as more and more people are starting to learn about and appreciate it. As awareness and acceptance grows of crypto it could result in increasing numbers of people purchasing or holding cryptocurrency, and this can raise prices.
revo network crypto
Financial decentralization (DeFi) is an area that is rapidly expanding in the crypto market, which allows financial services to be created using blockchain technology. As DeFi expands and more projects and platforms become available, this will lead to a rise in adoption and increased prices for crypto.
Developments in crypto payment methods
As the market for crypto continues to grow as more and more businesses are starting to accept crypto as a method of payment. This could lead to increased use of crypto in everyday transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are owned by the state as investment vehicles, are beginning to explore cryptocurrency as a possible asset class. As more of these funds devote a percentage of their assets to digital currencies, it could increase demand and higher prices.
Cryptocurrency is used for payment across borders
One of the biggest benefits of crypto is its capability to perform swift and affordable cross-border transactions. As more individuals and businesses start to utilize cryptocurrency for international transactions, it could result in increased the demand for it and a rise in prices.
An increasing number of crypto ATM’s
As the number of crypto ATM’s increase it will be easier for consumers to purchase and hold cryptocurrency, which can boost demand and increase prices.
The development of security tokens
Security tokens, which are digital assets that are used to represent ownership in an asset like real estate or stock are rapidly expanding area of the crypto market. Since more and more security tokens will be issued and traded, it could result in a rise in demand and higher rates for the crypto.
A greater adoption rate by merchants
In the event that more businesses start accepting crypto as a means of payment, it will make it more convenient for people to utilize and store cryptocurrency, which will boost demand and increase prices.
So, is crypto likely to rise in 2023? Only time will tell. With these things to consider, it’s possible that the crypto market could be able to see a rebound in 2023. And for those who are looking to invest for the long run patience and discipline will be key.