It’s been a difficult journey for the cryptocurrency market through 2022. By November the market had dropped by 70 percent from its previous high on November 20, 2021. Just when the market was looking down and down, the FTX crash made them look worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has experienced many drops in the past. Every time, it has bounced back with a huge rally.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for over a year before reaching a bottom of $150. But, in 2017, it broke that record and reached a new highest of $19,600. Fast forward to 2018, and it was trading at $3,100. And in 2020, the price broke through that resistance and hit a new highest of $68,000 in November 2021. Just like that, we’ve had another dip. However, history has shown 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 are typically followed by a lengthy bull run that finally surpasses the resistance created by the previous market’s highest price. This pattern is evident not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in the last few years. With more and more companies and industries taking to it, its usage and acceptance is growing. From gaming to finance, crypto is being used in many ways. This growing demand could lead to more people being involved in the market which could boost prices.
A rise in the interest of institutions for crypto
In recent times we’ve witnessed a rising curiosity from institutions investing in crypto. From hedge funds to banks numerous large institutions are starting to explore the possibilities in crypto currencies. This increased interest from institutions could bring more stability to the market for crypto and could lead to greater prices.
Government regulations
As the crypto market continues to mature as it matures, governments all over the world are beginning to develop more favorable rules for crypto. This will help draw more investors and increase the adoption rate of crypto.
More use cases for blockchain
The technology that is the basis of many cryptocurrencies, blockchain, offers a variety of applications that go beyond the realm of financial transactions. In addition to supply chain management, voting and other systems and more industries are exploring ways they can make use of blockchain technology, which could drive more investment and interest in crypto.
Technology advancements
Blockchain technology and cryptography are still in the early stages of development. As advancements continue to be made in areas such as scalability and security, the potential of crypto assets will continue to expand. This could lead to more adoption and higher prices.
Uncertainty in the global economy
Due to the constant instability in the economy caused by the COVID-19 pandemic and other factors, more and more investors are starting to look for safe haven assets such as cryptocurrency and gold. Because the global economic climate remains uncertain it could result in increased demand for crypto and higher prices.
Interest from retail investors
The institutional investors aren’t alone in one who’s showing an interest in cryptocurrency. Retail investors, or even individual investors are also beginning to invest in the market for crypto. In the future, as more people are educated about crypto and the best ways to invest 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 continues to mature increasing numbers of people are beginning to learn about and appreciate the concept. As awareness and acceptance of crypto grows, this could lead to increasing numbers of people purchasing and holding crypto, which could drive up prices.
titan invest crypto
Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market that allows financial services to be developed using blockchain technology. As DeFi expands and more platforms and projects become available, this could result in increased use and more expensive prices for crypto.
Advances in crypto-based payment methods
As the crypto market is growing as more and more businesses are beginning accepting crypto payments as a means of payment. This could lead to an increase in the use of crypto in regular transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as owned by the state as instruments for investing, are starting to explore cryptocurrency as a possible asset class. As more of these funds allocate a portion or their entire portfolios to cryptocurrency, it could lead to increased demand and increased prices.
Utilization of crypto to make cross-border payments
One of the main advantages of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more and more people and businesses start to utilize 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 ATMs that accept crypto continue to grow, it will become easier for individuals to purchase and hold crypto, which will boost demand and increase prices.
The development of security tokens
Security tokens, which are digital assets that represent ownership of 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 created and traded, this could result in a rise in demand and consequently higher costs for cryptocurrency.
More adoption by merchants
In the event that more merchants start accepting cryptocurrency as a method of payment, this will make it more convenient for consumers to use and hold crypto, which can drive up demand and prices.
Will crypto be on the increase in 2023? The only way to know is time. However, with these aspects to consider, it’s likely that the crypto market will be able to see a rebound in 2023. If you’re looking to invest for the long haul patience and discipline is crucial.