It’s been a tough experience for the crypto market until 2022. By November, the market had dipped by more than 70 percent from the previous high on November 20, 2021. Just when the market was looking down and down, the FTX crash turned them even more dire. What is the likelihood that the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen its fair share of dips over the years. Each time, it’s bounced back by a massive rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for over a year before hitting a low of $150. However, in 2017 it broke that record and reached a new highest of $19,600. In 2018, and it was trading at $3,100. And in 2020, the price broke through the resistance, and reached a record high of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. However, the past has proven that at the end of every dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed previously, dips tend to be followed by a prolonged bull run that finally surpasses the resistance created by the market’s previous highest price. This pattern can be seen in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in recent years. With more and better companies and industries embracing it, its usage and acceptance is growing. From gaming to finance cryptocurrency is being utilized in a variety of ways. This growing demand could lead to increasing participation in the market and, in turn, increase the price.
A rise in the interest of institutions for cryptocurrency
In the last few years, we’ve seen a growing interest from institutional investors in cryptocurrency. From banks to hedge funds, many large institutions are now exploring the potential in crypto currencies. The increasing interest from institutions could bring more stability to the crypto market and result in more expensive prices.
As the crypto market continues to mature and mature, governments across the globe are beginning to develop more favorable regulations for crypto. This will help draw more investors and boost the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that underlies the majority of cryptocurrencies, blockchain is a broad range of applications that go that go beyond financial transactions. For example, from supply chain management and voting, many industries are exploring ways they can benefit from blockchain technology. This could drive more investment and interest in crypto.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is at the very beginning of development. As progress is made in areas like scalability and security, the potential of crypto assets will continue to grow. This could lead to greater adoption and higher prices.
Rising global economic uncertainty
In the current instability in the economy caused due to the COVID-19 pandemic and other factors increasing numbers of investors are starting to look for safe haven assets like gold and crypto. Since the economic outlook for the world remains uncertain it could result in an increase in demand for crypto and increased prices.
Interest from retail investors
Institutional investors aren’t the only ones showing interest in cryptocurrency. Retail investors, also known as individual investors, are also starting to participate in the market for crypto. As more and more everyday people are educated about crypto and how to invest in it, this could lead to an increase in demand and consequently higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto is maturing as more and more people are starting to learn about and understand it. As understanding and acceptance of cryptocurrency grows, this could lead to more people purchasing as well as holding the crypto that could increase prices.
safe earn crypto
The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market that enables financial services to be created on top of blockchain technology. As DeFi grows and more projects and platforms become available, this could lead to increased adoption and higher prices for crypto.
Developments in crypto payment methods
As the crypto market grows increasing numbers of companies are starting using crypto to be a form of payment. This could lead to increased use of crypto in regular transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are state-owned instruments for investing, are starting to look at cryptocurrency as a possible asset class. As more of these funds allocate a portion or their entire portfolios to cryptocurrency, this could lead to increased demand and higher prices.
Utilization of crypto to make international payments
One of the main advantages of crypto is the capability to perform swift and affordable cross-border transactions. As more businesses and individuals are beginning to make use of cryptocurrency for international transactions, it could result in increased demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of ATMs for crypto continue to grow, it will become easier for people to buy and store cryptocurrency, which can increase demand and price.
Development of security tokens
Security tokens, also known as digital assets that signify ownership in an asset such as real estate or stock is a fast-growing segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, this can lead to a higher demand, and thus higher rates for the crypto.
A greater adoption rate by merchants
As more and more retailers begin accepting crypto as a means of payment, this will make it more convenient for customers to use and hold crypto, which could increase demand and price.
Will crypto be on the increase in 2023? It’s only time to find out. But with these factors to consider, it’s likely that the cryptocurrency market will have a rebound by 2023. If you’re committed to the long-term, being patient and disciplined is essential.