It’s been a rough ride for the crypto market in 2022. By November, the market had dipped by more than 70 percent from the previous high at the end of November. Just when the market was getting worse after the FTX crash turned things even worse. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced its fair share of drops in the past. Each time, it’s rebounded by a massive increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for over a year before reaching a bottom of $150. In 2017 it broke that record, and hit a new record high of $19,600. Fast forward to 2018, the price was at $3,100. And in the year 2020 it struck that resistance, and reached a record high of $68,000 in November 2021. And just like that, we’ve had another dip. 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
As we’ve seen previously, dips are usually followed by a lengthy bull run that finally surpasses the resistance created by the previous market’s highest price. This is evident in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in recent years. With more and more businesses and industries taking to the technology, its use and acceptance is increasing. From finance to gaming, crypto is being used in a variety of ways. And this growing use case could result in more people getting involved in the market, which in turn could boost prices.
The rise in interest of institutions in crypto
In recent years we’ve noticed a growing interest from institutional investors in crypto. From banks to hedge funds numerous large institutions 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 continues to mature, governments around the world are starting to create more favorable rules for crypto. This will help draw more investors as well as increase the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that is the basis of many cryptocurrency, blockchain, has a wide range of potential use cases that go beyond financial transactions. From supply chain management to voting systems, more companies are beginning to look at ways they can make use of blockchain technology, which could stimulate more investment and excitement in crypto.
Advancements in technology
Blockchain technology and cryptography are still in the early stages of development. As progress is made in areas like security and scalability, the potential of cryptocurrency assets will continue to expand. This could result in more use and increase in prices.
Global economic uncertainty is growing
In the current economic uncertainty caused due to 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 remains uncertain, this could lead to an increase in demand for crypto and more expensive 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 invest in the cryptocurrency market. In the future, as more everyday people are educated about crypto and the best ways to invest in it This could result in increased demand and higher prices.
Growing awareness and acceptance of crypto
As the market for crypto is maturing as more and more people are starting to learn about and understand it. As the awareness and acceptance grows of crypto it could result in more people purchasing as well as holding the crypto that can drive up prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market that allows the provision of financial services developed upon blockchain technology. As DeFi expands and more projects and platforms become available, this could result in increased use and more expensive prices for crypto.
Developments in crypto payment methods
As the crypto market is growing, more and more companies are starting using crypto to be a form of payment. This could lead to an increase in the usage of crypto in daily transactions and higher prices.
The increased investment of sovereign wealth funds
These funds are state-owned investments, are starting to explore crypto as a potential 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 main advantages of cryptocurrency is its capability to perform quick and inexpensive cross-border payments. As more businesses and individuals begin to use cryptocurrency for international transactions it could result in increased the demand for it and a rise in prices.
An increasing number of crypto ATM’s
As the number of crypto ATM’s continue to increase it will be easier for consumers to purchase and hold crypto, which could increase demand and price.
Security tokens are developed for development
Security tokens, also known as digital assets that represent ownership of an asset, such as stock or real estate, are a rapidly growing area of the crypto market. As more security tokens are issued and traded, this can lead to a higher demand, and thus higher prices for crypto.
Merchants are more likely to adopt the concept.
As more and more retailers begin accepting crypto as a form of payment, this will make it more convenient for people to hold and use crypto, which could increase demand and price.
So, will crypto rise in 2023? It’s only time to find out. With these things to consider, it’s possible that the crypto market will have a rebound by 2023. If you’re looking to invest for the long-term Being patient and disciplined is crucial.