It’s been a tough experience for the crypto market until 2022. As of November the market had dropped by more than 70% from its previous peak in November 2021. And just when things were looking 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 experienced its fair share of dips over the years. Each time, it has bounced back with a huge rise.
For example, in 2013, Bitcoin reached a peak of $1,160. Then it fell for over a year before hitting a low of $150. In 2017 it broke that record, and hit a new high of $19,600. Then, in 2018, it was trading at $3,100. And in 2020, the price broke through the resistance and reached a new high of $68,000 in November 2021. Just like that, we’ve seen another dip. 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 previously, dips tend to be followed by a lengthy bull run that eventually breaks through the resistance created by the previous high price. This pattern can be seen in more than Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have progressed a lot in recent years. With more and better companies and industries taking to it, its usage and acceptance is increasing. From gaming to finance, crypto is being used in many ways. This growing demand can lead to more people getting involved in the market which could drive the prices up.
Increased institutional interest in cryptocurrency
In recent years, we’ve seen a growing demand from investors of institutional scale in cryptocurrency. From banks to hedge funds, many large institutions are beginning to investigate the potential for crypto-based assets. This increased interest from institutions could bring more stability to the crypto market and lead to higher prices.
Regulations from the Government
As the crypto market is maturing, governments around the world are beginning to establish more favorable rules for cryptocurrency. This could help attract more investors and increase the acceptance of crypto in general.
More use cases for blockchain
The technology that underlies many cryptocurrency, blockchain, has a wide range of applications that go that go beyond financial transactions. From supply chain management to voting systems, more and more industries are exploring ways they can utilize blockchain technology. This could increase investment and enthusiasm in crypto.
Blockchain technology and cryptography are still in the beginning stages of development. As advances continue to be made in areas such as security and scalability, potential of crypto assets will continue to increase. This could lead to greater adoption and higher prices.
Rising global economic uncertainty
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 like bitcoin and even gold. As the global economic situation is uncertain and uncertain, this could lead to increased demand for crypto and increased prices.
Interest from retail investors
Investors from institutions aren’t the only people who are interested in crypto. Retail investors, also known as individual investors, are also starting to get involved in the cryptocurrency market. As more and more people are educated about crypto and how to invest in it This could result in increased demand and higher prices.
Growing awareness and acceptance of crypto
As the crypto market grows increasing numbers of people are beginning to become aware about it and comprehend the concept. As understanding and acceptance of crypto grows, it will lead to increasing numbers of people purchasing as well as holding the crypto that could raise prices.
synapse bridge crypto
Decentralized finance (DeFi) is an emerging area of the crypto market that enables the provision of financial services developed upon blockchain technology. As DeFi expands and more projects and platforms come online, this will lead to a rise in adoption and increased prices for crypto.
Advances in crypto-based payment methods
As the market for crypto continues to grow, more and more companies are beginning to accept crypto as a form of payment. This could result in increased use of crypto in everyday transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as state-owned investment vehicles, are starting to show interest in crypto as a potential asset class. As more of these funds dedicate a part of their portfolio to crypto, this could result in a rise in demand and more expensive prices.
Cryptocurrency is used for payment across borders
One of the major benefits of cryptocurrency is its ability to facilitate swift and affordable cross-border transactions. As more individuals and businesses are beginning to make use of cryptocurrency for international transactions, it could result in increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
As the number of crypto ATM’s continue to increase it will be more convenient for people to buy and keep crypto, which could drive up demand and prices.
Development of security tokens
Security tokens, also known as digital assets that are used to represent ownership in an asset such as stocks or real estate, are a rapidly growing sector of the crypto market. With the increasing number of security tokens being issued and traded, this could result in a rise in demand, and thus higher prices for crypto.
Merchants are more likely to adopt the concept.
With the increasing number of retailers accept cryptocurrency as a method of payment, this will make it more convenient for consumers to use and hold cryptocurrency, which will drive up demand and prices.
So, will crypto rise in 2023? Only time will tell. However, with these aspects in mind, it’s possible that the crypto market could have a rebound by 2023. And for those who are in it for the long haul, being patient and disciplined is crucial.