It’s been a difficult experience for the crypto market through 2022. In November the market was down by 70 percent from its previous high in November 2021. Just when the market was getting worse after the FTX crash turned them more dire. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many dips over the years. Every time, it’s rebounded with a huge rally.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for more than a year, reaching a low of $150. But, in 2017 it broke that record and reached a new highest of $19,600. Fast forward to 2018, and it was trading at $3,100. In the year 2020 it struck that resistance and reached a new highest of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. However, history has shown us 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 in the past, dips tend to be followed by a prolonged bull run, which eventually surpasses the resistance created by the previous market’s highest price. This pattern can be seen in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in recent years. With more and better companies and industries embracing it, its usage and acceptance is rising. From banking to gaming the use of crypto is increasing in a variety of ways. The growing popularity of crypto can lead to increasing participation in the market and, in turn, drive the prices up.
The rise in interest of institutions in crypto
In recent years we’ve witnessed a rising curiosity from institutions investing in crypto. From hedge funds to banks and even large corporations are beginning to investigate the potential in crypto currencies. This increased interest from institutions can bring stability to the market for crypto and result in higher prices.
Regulations of the government
As the crypto market continues to mature and mature, governments across the globe are beginning to develop more favorable regulations for crypto. This could help attract more investors and boost the adoption rate of crypto.
Blockchain has many more applications.
The technology that underlies the majority of cryptocurrencies, blockchain has a wide range of potential use cases beyond the realm of financial transactions. From supply chain management to voting systems, more and more industries are starting to explore how they can make use of blockchain technology, which could stimulate more investment and excitement in cryptocurrency.
Technology advancements
Blockchain technology and cryptography are still in the beginning stages of development. As advancements continue to be made in areas such as security and scalability, potential of crypto assets will continue to grow. This could result in more acceptance and higher prices.
Global economic uncertainty is growing
Due to the constant instability in the economy caused due to the COVID-19 pandemic, as well as other causes increasing numbers of investors are starting to look for safe haven investments like cryptocurrency and 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
The institutional investors aren’t alone in people who are interested in crypto. Retail investors, also known as individual investors are also beginning to get involved in the market for crypto. With increasing numbers of people learn about crypto and the best ways to invest in it, this could lead to increased demand and higher prices.
Growing awareness and acceptance of crypto
As the market for crypto grows as more and more people are beginning to learn about and understand the concept. As awareness and acceptance of crypto grows, it will lead to more people buying or holding cryptocurrency, and this could increase prices.
sai crypto
Financial decentralization (DeFi) is a rapidly growing area of the crypto market, which allows financial services to be built on top of blockchain technology. As DeFi expands and more platforms and projects are launched, it could result in increased use and more expensive prices for crypto.
Advances in crypto-based payment methods
As the market for crypto is growing as more and more businesses are beginning accepting crypto payments as a form of payment. This could result in increased use of crypto in everyday transactions, and a rise in prices.
Increased investment from sovereign wealth funds
These funds are government-owned investments, are starting to show interest in cryptocurrency as a possible asset class. As more of these funds allocate a portion of their assets to digital currencies, this could result in a rise in demand and increased prices.
Utilization of crypto to make payment across borders
One of the major benefits of crypto is its ability to facilitate fast and cheap cross-border payments. As more businesses and individuals are beginning to make use of cryptocurrency for international transactions, it could result in increased demand and higher costs.
An increasing number of crypto ATM’s
The number of ATMs that accept crypto continue to increase, it will become easier for people to buy and store crypto, which will boost demand and increase prices.
Security tokens are developed for development
Security tokens, or digital assets that signify ownership in an asset such as stock or real estate, are a rapidly growing area of the crypto market. As more security tokens are created and traded, it can lead to a higher demand and consequently higher rates for the crypto.
A greater adoption rate by merchants
With the increasing number of retailers begin accepting cryptocurrency as a method of payment, this makes it easier for customers to use and hold crypto, which can boost demand and increase prices.
Will crypto be on the grow in 2023? It’s only time to find out. But with these factors being considered, it’s possible that the cryptocurrency market will be able to see a rebound in 2023. For those committed to the long-term patience and discipline will be key.