It’s been a tough journey for the cryptocurrency market in 2022. By November, the market had dipped by more than 70 percent from the previous high in November 2021. When things were going downhill and down, the FTX crash turned them even worse. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had many dips over the years. And every time, it has bounced back with a huge rally.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for more than a year before hitting a low of $150. However, in 2017, it broke that record and hit a record highest of $19,600. In 2018, it was trading at $3,100. And in 2020, it broke through that resistance and reached a new highest of $68,000 in November 2021. Then, just like that we’ve had another dip. But history shows us that at the end of every dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
As we’ve seen in the past, dips are usually followed by a long bull run, which eventually breaks through the resistance created by the previous market’s highest price. This pattern is evident not only in Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in the last few years. With more and more businesses and industries taking to it, its usage and acceptance is increasing. From finance to gaming, 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 boost prices.
Increased institutional interest in crypto
In recent times we’ve witnessed a rising interest from institutional investors in crypto. From hedge funds to banks, many large institutions are now exploring the potential of crypto assets. The increasing interest from institutions could bring more stability to the market for crypto and could lead to higher prices.
Regulations of the government
As the crypto market grows, governments around the world are starting to create more favorable rules for cryptocurrency. This is likely to attract more investors as well as increase the mainstream adoption of crypto.
A broader range of blockchain applications
The technology that underlies many cryptocurrencies, blockchain, has a wide range of possible applications beyond just financial transactions. In addition to supply chain management, voting and other systems industries are beginning to look at ways they can make use of blockchain technology. This will drive more investment and interest in crypto.
Technologies are constantly evolving.
Crypto and blockchain technology are still in the early stages of development. As progress is made in areas such as security and scalability, potential of crypto assets will expand. This could result in more adoption and higher prices.
Global economic uncertainty is growing
In the current instability in the economy caused due to the COVID-19 pandemic, as well as other causes, more and more 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 increased demand for crypto and higher prices.
Interest from retail investors
Investors from institutions aren’t the only ones showing interest in crypto. Retail investors, or even individual investors are also beginning to invest in the market for crypto. With increasing numbers of people are educated about crypto and the best ways to invest in it This could result in more demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto continues to mature as more and more people are starting to learn about and appreciate it. As the awareness and acceptance of cryptocurrency grows, it will lead to more people purchasing and holding crypto, which can raise prices.
shih tzu coin crypto
Financial decentralization (DeFi) is a rapidly growing area of the crypto market that enables the provision of financial services built upon blockchain technology. As DeFi expands and more platforms and projects come online, this could result in increased use and higher prices for crypto.
Advances in crypto-based payment methods
As the market for crypto is growing increasing numbers of companies are beginning accepting crypto payments as a form of payment. This could result in increased use of crypto in regular transactions and higher prices.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned investments, are starting to look at cryptocurrency as a possible asset class. As more of these funds devote a percentage of their assets to digital currencies, it could increase demand and higher prices.
Utilization of crypto to make international payments
One of the main advantages of cryptocurrency is its capability to perform fast and cheap cross-border payments. As more businesses and individuals are beginning to make use of cryptocurrency for international transactions this could lead to increased the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
With the amount of crypto ATM’s continue to increase it will be more convenient for people to buy and keep crypto, which will increase demand and price.
Development of security tokens
Security tokens, also known as digital assets that represent ownership of an asset, like stock or real estate are rapidly expanding sector of the crypto market. With the increasing number of security tokens being issued and traded, it can lead to a higher demand, and thus higher prices for crypto.
A greater adoption rate by merchants
In the event that more merchants start accepting crypto as a means of payment, this will make it easier for people to utilize and store cryptocurrency, which will increase demand and price.
So, will crypto increase in 2023? Only time will tell. But with these factors to consider, it’s possible that the cryptocurrency market will see a recovery in 2023. If you’re committed to the long run, being patient and disciplined will be key.