It’s been a difficult ride for the crypto market through 2022. By November the market was down by more than 70% from its previous peak at the end of November. And just when things were going downhill and down, the FTX crash turned things more dire. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had many dips in the past. Every time, it’s rebounded by a massive rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for a full year before reaching a bottom of $150. However, in 2017, it broke the record, and hit a new highest of $19,600. Then, in 2018, the price was at $3,100. And in the year 2020 it struck that resistance, and reached a record highest of $68,000 in November 2021. And just like that, we’ve witnessed another drop. However, the past has proven that following each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs are typically followed by a prolonged bull run that eventually overcomes the resistance set by the market’s previous highest price. This pattern is evident not only in Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in the last few years. With more and better companies and industries embracing it, its usage and acceptance is growing. From gaming to finance 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, which in turn could increase the price.
Increased institutional interest in cryptocurrency
In the last few years we’ve noticed a growing demand from investors of institutional scale in crypto. From hedge funds to banks and even large corporations are beginning to investigate the potential of crypto assets. The increased interest of institutions could bring more stability to the crypto market and result in greater prices.
Regulations of the government
As the crypto market is maturing and mature, governments across the globe 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 the majority of cryptocurrencies, blockchain offers a variety of applications that go beyond the realm of financial transactions. For example, from supply chain management and voting, many industries are exploring ways they can utilize blockchain technology. This could stimulate more investment and excitement in cryptocurrency.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is at the very beginning of development. As progress is made in areas like security and scalability, the potential of crypto assets will increase. This could result in more use and increase in prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty brought on by the COVID-19 pandemic as well as other factors many investors are looking for safe haven assets like gold and crypto. As the global economic situation remains uncertain, this could lead to an increase in demand for crypto and higher prices.
Interest from retail investors
Institutional investors aren’t the only people who are interested in cryptocurrency. Retail investors, also known as individual investors, are also starting to participate in the cryptocurrency market. In the future, as more people are educated about crypto and the best ways to invest in it, this could lead to increased demand and higher prices.
The growing awareness and acceptance of crypto
As the crypto market grows increasing numbers of people are starting to learn about and understand the concept. As awareness and acceptance of crypto grows it could result in more people buying or holding cryptocurrency, and this could raise prices.
shorting in crypto
Financial decentralization (DeFi) is a rapidly growing area of the crypto market that allows financial services to be created using blockchain technology. As DeFi grows 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 continues to grow as more and more businesses are beginning to accept crypto as a method of payment. This could result in increased usage of crypto in daily transactions and higher prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned instruments for investing, are starting to show interest in crypto as a potential asset class. As more funds dedicate a part of their assets to digital currencies, this could increase demand and higher prices.
Utilization of crypto to make cross-border payments
One of the main advantages of crypto is its ability to make swift and affordable cross-border transactions. As more businesses and individuals begin to use crypto for international transactions, it could result in increased demand and higher costs.
Increasing numbers of crypto ATM’s
As the number of crypto ATM’s continue to grow it will be easier for individuals to purchase and store cryptocurrency, which can boost demand and increase prices.
The development of security tokens
Security tokens, or digital assets that are used to represent ownership in an asset such as real estate or stock, are a rapidly growing segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, this could result in a rise in demand and higher prices for crypto.
More adoption by merchants
With the increasing number of merchants begin accepting crypto as a means of payment, it will make it more convenient for customers to utilize and store crypto, which could drive up demand and prices.
Will crypto be on the increase in 2023? It’s only time to find out. However, with these aspects to consider, it’s likely that the crypto market will be able to see a rebound in 2023. For those looking to invest for the long haul Being patient and disciplined is essential.