It’s been a tough experience for the crypto market in 2022. In November, the market had dipped by 70 percent from the previous high on November 20, 2021. And just when things were getting worse and down, the FTX crash turned things even more dire. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had many drops in the past. And every time, it’s rebounded with a huge rise.
For instance, in 2013, Bitcoin reached a peak of $1,160, then fell for a full 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, the price was at $3,100. And in 2020, the price broke through that resistance and reached a new high of $68,000 in November 2021. Just like that, we’ve witnessed another drop. But history shows us that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
As we’ve seen before, fall-offs tend to be followed by a lengthy bull run that finally surpasses the resistance created by the previous market’s highest price. This pattern can be seen in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in the last few years. With more and better companies and industries embracing it, its usage and acceptance is growing. From banking to gaming cryptocurrency is being utilized in a variety of ways. The growing popularity of crypto could result in more people being involved in the crypto market and, in turn, drive the prices up.
Increased institutional interest in crypto
In recent times we’ve noticed a growing interest from institutional investors in cryptocurrency. From banks to hedge funds, many large institutions are starting to explore the possibilities in crypto currencies. The increased interest of institutions could provide more stability to the market for crypto and could lead to greater prices.
As the crypto market continues to mature and mature, governments across the globe are beginning to establish more favorable regulations for crypto. This is likely to attract more investors as well as increase the acceptance of crypto in general.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrencies, blockchain, offers a variety of possible applications beyond the realm of financial transactions. In addition to supply chain management, voting and other systems industries are exploring ways they can utilize blockchain technology. This will drive more investment and interest in cryptocurrency.
Advancements in technology
Blockchain and cryptocurrency technology is still in the beginning stages of development. As advancements continue to be made in areas like scalability and security, the potential of crypto assets will continue to grow. This could result in more use and increase in prices.
Global economic uncertainty is growing
In the current economic uncertainty brought on through the COVID-19 pandemic as well as other factors increasing numbers of investors are starting to look for safe haven assets like bitcoin and even gold. As the global economic situation is uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Interest from retail investors
Investors from institutions aren’t the only ones showing interest in cryptocurrency. Retail investors, or individual investors, are also starting to get involved in the market for crypto. In the future, as more people are educated about cryptocurrency and investing in it this could result in increased demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto grows, more and more people are starting to learn about it and comprehend it. As the awareness and acceptance grows of crypto, it will lead to increasing numbers of people purchasing or holding cryptocurrency, and this can raise prices.
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Financial decentralization (DeFi) is a rapidly growing area of the crypto market that allows financial services to be developed using blockchain technology. As DeFi grows and more projects and platforms are launched, it will lead to a rise in adoption and higher prices for crypto.
Developments in crypto payment methods
As the market for crypto continues to grow as more and more businesses are starting accepting crypto payments as a method of payment. This could lead to an increase in the use of crypto in everyday transactions and higher prices.
More investment from sovereign wealth funds
Sovereign wealth funds, which are state-owned investments, are beginning to look at crypto as an asset class. As more funds dedicate a part of their assets to digital currencies, it could result in a rise in demand and more expensive prices.
Utilization of crypto to make payment across borders
One of the major benefits of cryptocurrency is its ability to make swift and affordable cross-border transactions. As more individuals and businesses start to utilize 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 increase it will be more convenient for individuals to purchase and hold crypto, which will drive up demand and prices.
Security tokens are developed for development
Security tokens, which are digital assets that are used to represent ownership of an asset, like stocks or real estate, are a rapidly growing segment of the cryptocurrency market. As more security tokens are issued and traded, this could lead to increased demand and consequently higher rates for the crypto.
A greater adoption rate by merchants
As more and more merchants accept crypto as a form of payment, it makes it easier for consumers to utilize and store cryptocurrency, which will increase demand and price.
Will crypto be on the rise in 2023? Only time will tell. With these things being considered, it’s possible that the crypto market could see a recovery in 2023. And for those who are looking to invest for the long run patience and discipline is crucial.