It’s been a rough ride for the crypto market until 2022. As of November the market was down by more than 70 percent from the previous high at the end of November. When things were going downhill, the FTX crash turned them even more dire. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen many drops in the past. Each time, it’s rebounded with a huge increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for more than a year before hitting a low of $150. However, in 2017, it broke the record and reached a new record high of $19,600. Fast forward to 2018, and it was trading at $3,100. And in 2020, the price broke that resistance and reached a new highest of $68,000 in November 2021. Just like that, we’ve had another dip. However, the past has proven that after each 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 lengthy bull run that finally breaks through the resistance created by the previous high price. This pattern can be seen in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in recent years. With more and more businesses and industries adopting the technology, its use and acceptance is growing. From banking to gaming, crypto is being used in many ways. And this growing use case could lead to increasing participation in the market, which in turn could increase the price.
A rise in the interest of institutions for cryptocurrency
In recent times, we’ve seen a growing interest from institutional investors in crypto. From hedge funds to banks numerous large institutions are now exploring the possibilities for crypto-based assets. The increased interest of institutions can bring stability to the market for crypto and lead to more expensive prices.
Regulations from the Government
As the market for crypto is maturing, governments around the world are beginning to develop more favorable regulations for cryptocurrency. This could help attract more investors as well as increase the acceptance of crypto in general.
More use cases for blockchain
The technology that is the basis of many cryptocurrencies, blockchain, offers a variety of potential use cases that go beyond financial transactions. In addition to supply chain management, voting and other systems and more industries are starting to explore how they can benefit from blockchain technology, which could increase investment and enthusiasm in crypto.
Technology advancements
Crypto and blockchain technology are still in the beginning stages of development. As advances continue to be made in areas like security and scalability, the potential of crypto assets will continue to grow. This could result in more use and increase in prices.
Rising global economic uncertainty
In the current economic uncertainty caused through the COVID-19 pandemic and other factors many investors are beginning to look for safe haven assets like bitcoin and even gold. Because the global economic climate remains uncertain and uncertain, this could lead to an increase in demand for crypto and more expensive prices.
Interest from retail investors
The institutional investors aren’t alone in ones showing interest in cryptocurrency. Retail investors, or individual investors are also beginning to get involved in the crypto market. With increasing numbers of people become aware of cryptocurrency and investing in it This could result in more demand and higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the market for crypto continues to mature as more and more people are beginning to become aware about it and comprehend the concept. As understanding and acceptance grows of crypto it could result in more people buying or holding cryptocurrency, and this could raise prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market that enables finance services built upon blockchain technology. As DeFi continues to grow and more platforms and projects come online, this could result in increased use and increased prices for crypto.
Developments in crypto payment methods
As the market for crypto grows, more and more companies are beginning using crypto to be a means of payment. This could result in increased usage of crypto in daily transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as owned by the state as investment vehicles, are now beginning to show interest in crypto as an asset class. As more funds dedicate a part of their assets to digital currencies, this could result in a rise in demand and more expensive prices.
Cryptocurrency is used for payment across borders
One of the biggest benefits of cryptocurrency is its ability to make swift and affordable cross-border transactions. As more businesses and individuals begin to use cryptocurrency for international transactions this could lead to increased demand and higher prices.
Increasing numbers of crypto ATM’s
As the number of crypto ATM’s continue to increase it will be more convenient for individuals to purchase and keep crypto, which will boost demand and increase prices.
Security tokens are developed for development
Security tokens, which are digital assets that represent ownership of an asset, such as stock or real estate are rapidly expanding segment of the cryptocurrency market. As more security tokens are created and traded, this can lead to a higher demand, and thus higher costs for cryptocurrency.
A greater adoption rate by merchants
With the increasing number of retailers accept crypto as a form of payment, it makes it easier for consumers to hold and use crypto, which can increase demand and price.
So, is crypto likely to increase in 2023? The only way to know is time. However, with these aspects being considered, it’s likely that the crypto market will see a recovery in 2023. And for those who are in it for the long-term Being patient and disciplined is essential.