It’s been a difficult journey for the cryptocurrency market in 2022. By November, the market had dipped by more than 70% from its previous peak on November 20, 2021. Just when the market was getting worse and down, the FTX crash turned things worse. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had many drops in the past. Every time, it’s bounced back with a huge rally.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for more than a year, reaching a low of $150. But, in 2017, it broke that record, and hit a new highest of $19,600. In 2018, the price was at $3,100. In the year 2020 it struck through the resistance and hit a new high of $68,000 in November 2021. Just like that, we’ve seen another dip. But history shows us that after each 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 long bull run, which eventually breaks through the resistance created by the previous high price. This pattern can be seen in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in recent years. With more and more companies and industries taking to it, its usage and acceptance is rising. From gaming to finance, crypto is being used in many ways. The growing popularity of crypto can lead to more people getting involved in the crypto market, which in turn could drive the prices up.
The rise in interest of institutions in cryptocurrency
In recent times we’ve witnessed a rising demand from investors of institutional scale in cryptocurrency. From banks to hedge funds, many large institutions are beginning to investigate the potential in crypto currencies. The increasing interest from institutions could provide more stability to the market for crypto and result in more expensive prices.
Regulations of the government
As the market for crypto grows, governments around the world are beginning to develop more favorable regulations for crypto. This is likely to attract more investors and boost the acceptance of crypto in general.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrency, blockchain, is a broad range of potential use cases beyond the realm of 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, which could increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Crypto and blockchain technology are still in the early stages of development. As progress is made in areas such as security and scalability, the potential of crypto assets will increase. This could result in more use and increase in prices.
Rising global economic uncertainty
In the current economic uncertainty brought on due to the COVID-19 pandemic, as well as other causes increasing numbers of investors are beginning to look for safe haven assets like bitcoin and even gold. Since the economic outlook for the world remains uncertain it could result in more demand for crypto as well as more expensive prices.
Interest from retail investors
Institutional investors aren’t the only one who’s showing an interest in crypto. Retail investors, or individual investors, are also starting to get involved in the crypto market. As more and more people are educated about crypto and how to invest in it, this could lead to more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market grows as more and more people are starting to learn about and appreciate it. As understanding and acceptance grows of crypto, it will lead to more people purchasing or holding cryptocurrency, and this could raise prices.
safe sun crypto price
Decentralized finance (DeFi) is an emerging area of the crypto market that enables finance services created upon blockchain technology. As DeFi continues to grow and more projects and platforms are launched, it will lead to a rise in adoption and more expensive prices for crypto.
Developments in crypto payment methods
As the crypto market continues to grow increasing numbers of companies are starting using crypto to be a means of payment. This could lead to an increase in the use of crypto in regular transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
These funds are government-owned instruments for investing, are now beginning to explore crypto as a potential asset class. As more funds devote a percentage or their entire portfolios to cryptocurrency, this could lead to increased demand and more expensive prices.
Use of crypto for cross-border payments
One of the main advantages of cryptocurrency is its capability to perform quick and inexpensive cross-border payments. As more individuals and businesses begin to use crypto for international transactions, it could result in increased demand and higher costs.
Increasing numbers of crypto ATM’s
With the amount of ATMs for crypto continue to grow it will be more convenient for individuals to purchase and store crypto, which will drive up demand and prices.
Development of security tokens
Security tokens, or digital assets that are used to represent ownership of an asset, such as stocks or real estate, are a rapidly growing segment of the cryptocurrency market. With the increasing number of security tokens being created and traded, this could result in a rise in demand, and thus higher rates for the crypto.
A greater adoption rate by merchants
With the increasing number of merchants begin accepting crypto as a form of payment, it will make it easier for people to utilize and store crypto, which could boost demand and increase prices.
So, will crypto rise in 2023? The only way to know is time. But with these factors to consider, it’s possible that the crypto market will be able to see a rebound in 2023. For those committed to the long run Being patient and disciplined is essential.