Rules Of Crypto Trading

It’s been a difficult ride for the crypto market through 2022. By November, the market had dipped by more than 70 percent from the previous high at the end of November. When things were getting worse and down, the FTX crash made them look even worse. So, will the crypto market recover in 2023?

Crypto Market Dips are Cyclical

The crypto market, especially Bitcoin has experienced its fair share of dips in the past. And every time, it has bounced back with a huge rally.

For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for more than a year before hitting a low of $150. In 2017, it broke the record, and hit a new record high of $19,600. Then, in 2018, and it was trading at $3,100. In 2020, the price broke through the resistance, and reached a record peak of $68,000 in the month of November 2021. Just like that, we’ve witnessed another drop. However, history has shown us that following each dip the bull runs.

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 that eventually breaks through the resistance created by the previous market’s highest price. This is evident in more than Bitcoin but also other cryptocurrencies.

Growing Use of Crypto and Blockchain

Blockchain and cryptocurrency technology has made significant progress in the last few years. With more and more businesses and industries embracing it, its usage and acceptance is increasing. From finance to gaming cryptocurrency is being utilized in a myriad of ways. And this growing use case can lead to increasing participation in the market which could drive the prices up.

The rise in interest of institutions in cryptocurrency

In recent years we’ve witnessed a rising interest from institutional investors in cryptocurrency. From banks to hedge funds, many large institutions are beginning to investigate the possibilities for crypto-based assets. The increasing interest from institutions can bring stability to the market for crypto and could lead to more expensive prices.

Government regulations

As the market for crypto is maturing and mature, governments across the globe are beginning to establish more favorable rules for cryptocurrency. This will help draw more investors and boost the acceptance of crypto in general.

More use cases for blockchain

The technology that is the basis of the majority of cryptocurrencies, blockchain is a broad range of potential use cases that go beyond financial transactions. For example, from supply chain management and voting, many and more industries are exploring ways they can utilize blockchain technology. This could increase investment and enthusiasm in cryptocurrency.

Technology advancements

Crypto and blockchain technology 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 increase. This could result in more adoption and higher prices.

Global economic uncertainty is growing

In the current instability in the economy caused through the COVID-19 pandemic as well as other factors, more and more investors are beginning to look for safe haven investments like bitcoin and even gold. Because the global economic climate remains uncertain it could result in more demand for crypto as well as increased prices.

Retail investors are able to earn interest

Investors from institutions aren’t the only people who are interested in crypto. Retail investors, or individual investors, are also starting to get involved in the market for crypto. As more and more people are educated about cryptocurrency and investing in it this could result in more demand and higher prices.

The growing awareness and acceptance of crypto

As the crypto market is maturing, more and more people are beginning to become aware about and appreciate it. As awareness and acceptance of cryptocurrency grows, this could lead to more people purchasing as well as holding the crypto that can increase prices.

rules of crypto trading

Financial decentralization (DeFi) is a rapidly growing area of the crypto market, which allows the provision of financial services developed using blockchain technology. As DeFi grows and more platforms and projects are launched, it could lead to increased adoption and more expensive prices for crypto.

Advances in crypto-based payment methods

As the crypto market grows increasing numbers of companies are starting using crypto to be a method of payment. This could lead to increased use of crypto in everyday transactions and an increase in the cost of transactions.

More investment from sovereign wealth funds

These funds are owned by the state as investments, are starting to explore cryptocurrency as a possible asset class. As more funds allocate a portion of their portfolio to crypto, it could increase demand and higher prices.

Utilization of crypto to make international payments

One of the main advantages of crypto is its capability to perform fast and cheap cross-border payments. As more businesses and individuals start to utilize cryptocurrency for international transactions it could result in increased demand and higher costs.

Increasing numbers of crypto ATM’s

The number of ATMs for crypto continue to grow it will be more convenient for people to buy and store crypto, which will drive up demand and prices.

Development of security tokens

Security tokens, also known as digital assets that represent ownership in an asset such as stocks or real estate, are a rapidly growing area of the crypto market. With the increasing number of security tokens being created and traded, it could lead to increased demand and consequently higher rates for the crypto.

More adoption by merchants

In the event that more retailers start accepting crypto as a means of payment, this will make it easier for consumers to hold and use cryptocurrency, which will drive up demand and prices.

Will crypto be on the increase in 2023? Only time will tell. But with these factors to consider, it’s likely that the crypto market will have a rebound by 2023. For those in it for the long-term patience and discipline will be key.