It’s been a tough journey for the cryptocurrency market through 2022. As of November the market had dropped by 70% from its previous peak at the end of November. Just when the market was getting worse, the FTX crash made them look worse. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had its fair share of dips in the past. Every time, it’s bounced back with a big rally.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for more than a year before reaching a bottom of $150. But, in 2017, it broke that record, and hit a new record high of $19,600. In 2018, and it was trading at $3,100. In 2020, the price broke through the resistance and reached a new high of $68,000 in November 2021. Just like that, we’ve had another dip. But history shows us 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 tend to be followed by a long bull run that finally breaks through the resistance created by the previous high price. This is evident in not just Bitcoin but also 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 rising. From gaming to finance cryptocurrency is being utilized in a variety of ways. And this growing use case can lead to more people getting involved in the crypto market and, in turn, increase the price.
The rise in interest of institutions in crypto
In the last few years we’ve noticed a growing demand from investors of institutional scale in crypto. From banks to hedge funds, many large institutions are now exploring the potential in crypto currencies. This increased interest from institutions could provide more stability to the crypto market and result in greater prices.
Government regulations
As the market for crypto grows and mature, governments across the globe are beginning to develop more favorable rules for crypto. This will help draw more investors and increase the acceptance of crypto in general.
Blockchain has many more applications.
The underlying technology behind the majority of cryptocurrencies, blockchain offers a variety of potential use cases beyond just 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 cryptocurrency.
Advancements in technology
Blockchain and cryptocurrency technology is still in the early stages of development. As progress is made in areas like security and scalability, the potential of crypto assets will continue to grow. This could lead to more use and increase in prices.
Rising global economic uncertainty
Due to the constant instability in the economy caused through the COVID-19 pandemic, as well as other causes, more and more investors are looking for safe haven assets such as cryptocurrency and gold. Since the economic outlook for the world is uncertain and uncertain, this could lead to more demand for crypto as well as more expensive prices.
Interest from retail investors
The institutional investors aren’t alone in people who are interested in cryptocurrency. Retail investors, also known as individual investors are also beginning to participate in the market for crypto. With increasing numbers of people become aware of cryptocurrency and investing in it This could result in increased demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto is maturing as more and more people are starting to learn about and appreciate it. As the awareness and acceptance of cryptocurrency grows, it will lead to more people buying as well as holding the crypto that could raise prices.
terrarium crypto coin
The Decentralized Finance (DeFi) is an emerging area of the crypto market that enables financial services to be created on top of blockchain technology. As DeFi expands and more platforms and projects are launched, it could lead to increased adoption and more expensive prices for crypto.
The development of crypto payment methods
As the market for crypto grows, more and more companies are beginning accepting crypto payments as 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
The sovereign wealth fund, also known as owned by the state as investment vehicles, are now beginning to explore crypto as a potential asset class. As more funds dedicate a part of their assets to digital currencies, it could result in a rise in demand and more expensive prices.
Utilization of crypto to make payment across borders
One of the main advantages of crypto is the ability to make quick and inexpensive 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 prices.
An increasing number of crypto ATM’s
With the amount of ATMs for crypto continue to grow it will be easier for consumers to purchase and hold crypto, which will boost demand and increase prices.
Development of security tokens
Security tokens, or digital assets that are used to represent ownership of an asset, like stocks or real estate is a fast-growing sector of the crypto market. As more security tokens are issued and traded, it could result in a rise in demand and consequently higher prices for crypto.
More adoption by merchants
As more and more retailers start accepting crypto as a means of payment, this makes it easier for customers to use and hold crypto, which can increase demand and price.
So, will crypto grow in 2023? Only time will tell. But with these factors being considered, it’s likely that the crypto market will see a recovery in 2023. If you’re committed to the long run Being patient and disciplined will be key.