It’s been a rough ride for the crypto market in 2022. By November the market had dropped by 70% from its previous peak at the end of November. When things were looking down, the FTX crash turned them even more dire. What is the likelihood that the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced many dips in the past. And every time, it has bounced back with a huge increase.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year, reaching a low of $150. In 2017 it broke that record and reached a new highest of $19,600. Then, in 2018, and it was trading at $3,100. In 2020, the price broke through the resistance and hit a new peak of $68,000 in the month of November 2021. Then, just like that we’ve had another dip. However, history has shown us that after each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs are usually followed by a lengthy bull run, which eventually breaks through the resistance created by the market’s previous highest price. This is evident in more than Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in the last few years. With more and better companies and industries adopting the technology, its use and acceptance is growing. From finance to gaming the use of crypto is increasing in many ways. And this growing use case can lead to more people getting involved in the market which could boost prices.
Increased institutional interest in crypto
In the last few years, we’ve seen a growing curiosity from institutions investing in cryptocurrency. From banks to hedge funds numerous large institutions are starting to explore the potential of crypto assets. This increased interest from institutions can bring stability to the market for crypto and lead to higher prices.
Regulations of the government
As the crypto market is maturing, governments around the world are starting to create more favorable regulations for cryptocurrency. This will help draw more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The technology that underlies the majority of cryptocurrencies, blockchain offers a variety of applications that go beyond just financial transactions. In addition to supply chain management, voting and other systems industries are starting to explore how they can make use of blockchain technology. This will increase investment and enthusiasm in cryptocurrency.
Technology advancements
Blockchain technology and cryptography are at the very beginning of development. As advances continue to be made in areas such as scalability and security, the potential of crypto assets will expand. This could lead to greater acceptance and higher prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty brought on by the COVID-19 pandemic and other factors, more and more investors are looking for safe haven investments like gold and crypto. As the global economic situation remains uncertain and uncertain, this could lead to increased demand for crypto and higher prices.
Interest from retail investors
Investors from institutions aren’t the only people who are interested in cryptocurrency. Retail investors, also known as individual investors are also beginning to participate in the cryptocurrency market. In the future, as more everyday people learn about cryptocurrency and investing in it This could result in an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting crypto
As the crypto market grows increasing numbers of people are starting to learn about it and comprehend the concept. As the awareness and acceptance of crypto grows, it will lead to more people purchasing and holding crypto, which can raise prices.
tales from the crypto
The Decentralized Finance (DeFi) is an emerging area of the crypto market that allows the provision of financial services developed on top of blockchain technology. As DeFi grows and more projects and platforms are launched, it could result in increased use and more expensive prices for crypto.
Developments in crypto payment methods
As the crypto market continues to grow, more and more companies are starting to accept crypto as a method of payment. This could result in increased usage of crypto in daily transactions and higher prices.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are government-owned instruments for investing, are now beginning to show interest in crypto as an asset class. As more of these funds allocate a portion of their assets to digital currencies, it could lead to increased demand and increased prices.
Cryptocurrency is used for payment across borders
One of the biggest benefits of crypto is the capability to perform fast and cheap cross-border payments. As more and more people and businesses start to utilize cryptocurrency for international transactions this can lead to a rise in demand and higher costs.
Increasing numbers of crypto ATM’s
The number of crypto ATM’s continue to grow it will be easier for people to buy and store crypto, which could drive up demand and prices.
Development of security tokens
Security tokens, which are digital assets that are used to represent ownership in an asset such as real estate or stock is a fast-growing area of the crypto market. With the increasing number of security tokens being created and traded, it could lead to increased demand and consequently higher prices for crypto.
Merchants are more likely to adopt the concept.
As more and more merchants start accepting crypto as a form of payment, it will make it more convenient for customers to utilize and store cryptocurrency, which will drive up demand and prices.
So, will crypto increase in 2023? The only way to know is time. With these things to consider, it’s possible that the cryptocurrency market will see a recovery in 2023. And for those who are looking to invest for the long run Being patient and disciplined will be key.