It’s been a difficult ride for the crypto market in 2022. As of November the market had dropped by more than 70% from its previous peak in November 2021. And just when things were going downhill 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 seen many dips over the years. Every time, it’s rebounded with a huge increase.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year before hitting a low of $150. However, in 2017 it broke that record and reached a new highest of $19,600. Then, in 2018, it was trading at $3,100. In the year 2020 it struck that resistance and hit a new high of $68,000 in November 2021. Then, just like that we’ve had another dip. But history shows us that following each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen in the past, dips are typically followed by a lengthy bull run that finally overcomes the resistance set by the market’s previous highest price. This pattern is evident 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 growing. From finance to gaming the use of crypto is increasing in a variety of ways. This growing demand could result in increasing participation in the crypto market which could increase the price.
Increased institutional interest in cryptocurrency
In recent years, we’ve seen a growing demand from investors of institutional scale in cryptocurrency. From hedge funds to banks and even large corporations are now exploring the potential in crypto currencies. The increased interest of institutions could bring more stability to the market for crypto and result in higher prices.
Regulations from the Government
As the market for crypto grows, governments around the world are beginning to develop more favorable rules for crypto. This will help draw more investors and boost the adoption rate of crypto.
More use cases for blockchain
The technology that is the basis of many cryptocurrencies, blockchain, offers a variety of potential use cases beyond the realm of financial transactions. From supply chain management to voting systems, more industries are beginning to look at ways they can utilize blockchain technology, which could drive more investment and interest in crypto.
Advancements in technology
Crypto and blockchain technology are still in the early stages of development. As advances continue to be made in areas such as security and scalability, potential of cryptocurrency assets will continue to expand. This could result in more use and increase in prices.
Global economic uncertainty is growing
With the ongoing instability in the economy caused by the COVID-19 pandemic and other factors, more and more investors are starting to look for safe haven assets such as bitcoin and even gold. Since the economic outlook for the world is uncertain and uncertain, this could lead to more demand for crypto as well as increased prices.
Retail investors are able to earn interest
Institutional investors aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, or even individual investors, are also starting to invest in the cryptocurrency market. As more and more people become aware of cryptocurrency and investing in it This could result in increased demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto continues to mature as more and more people are beginning to learn about and appreciate it. As the awareness and acceptance of crypto grows it could result in increasing numbers of people purchasing and holding crypto, which can raise prices.
scalping meaning in crypto
Decentralized finance (DeFi) is a rapidly growing area of the crypto market that enables the provision of financial services built using blockchain technology. As DeFi continues to grow and more projects and platforms become available, this could lead to increased adoption and increased prices for crypto.
Advances in crypto-based payment methods
As the market for crypto grows increasing numbers of companies are beginning using crypto to be a method of payment. This could result in increased usage of crypto in daily transactions and higher prices.
The increased investment of sovereign wealth funds
These funds are government-owned investment vehicles, are beginning to explore crypto as an asset class. As more funds dedicate a part or their entire portfolios to cryptocurrency, this could result in a rise in demand and increased prices.
Utilization of crypto to make payment across borders
One of the biggest benefits of crypto is its ability to make fast and cheap cross-border payments. As more and more people and businesses are beginning to make use of cryptocurrency for international transactions this could lead to increased demand and higher costs.
The number of ATMs that accept crypto is increasing.
As the number of ATMs that accept crypto increase it will be easier for consumers to purchase and hold cryptocurrency, which can drive up demand and prices.
Development of security tokens
Security tokens, or digital assets that are used to represent ownership in an asset like stocks or real estate are rapidly expanding segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, this can lead to a higher demand and higher rates for the crypto.
A greater adoption rate by merchants
With the increasing number of retailers start accepting crypto as a means of payment, this will make it more convenient for consumers to use and hold crypto, which can drive up demand and prices.
So, is crypto likely to increase in 2023? The only way to know is time. With these things being considered, it’s likely that the crypto market could be able to see a rebound in 2023. For those in it for the long-term Being patient and disciplined will be key.