It’s been a rough journey for the cryptocurrency market until 2022. In November the market was down by 70 percent from its previous high in November 2021. And just when things were looking down after the FTX crash turned them even more dire. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen its fair share of drops in the past. Every time, it’s rebounded with a huge increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for over a year before hitting a low of $150. But, in 2017, it broke that record and reached a new record high of $19,600. Fast forward to 2018, the price was at $3,100. And in 2020, it broke that resistance and hit a new highest of $68,000 in November 2021. Then, just like that we’ve seen another dip. However, the past has proven that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
As we’ve seen previously, dips are typically followed by a long bull run that finally 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 progressed a lot in the last few years. With more and more companies and industries embracing the technology, its use and acceptance is increasing. From banking to gaming, crypto is being used in a myriad of ways. This growing demand can lead to more people being involved in the crypto market which could drive the prices up.
The rise in interest of institutions in crypto
In recent times, we’ve seen a growing demand from investors of institutional scale in crypto. From hedge funds to banks numerous large institutions are starting to explore the possibilities for crypto-based assets. The increased interest of institutions could bring more stability to the crypto market and result in more expensive prices.
Regulations from the Government
As the crypto market grows, governments around the world are starting to create more favorable rules for crypto. This is likely to attract more investors as well as 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 possible applications beyond the realm of financial transactions. For example, from supply chain management and voting, many companies are beginning to look at ways they can benefit from blockchain technology. This will increase investment and enthusiasm in crypto.
Technology advancements
Blockchain technology and cryptography are still in the early stages of development. As advances continue to be made in areas like security and scalability, potential of crypto assets will increase. This could result in more adoption and higher prices.
Uncertainty in the global economy
With the ongoing economic uncertainty caused through the COVID-19 pandemic and other factors, more and more investors are beginning to look for safe haven investments like bitcoin and even gold. Because the global economic climate remains uncertain it could result in an increase in demand for crypto and increased prices.
Interest from retail investors
Institutional investors aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, also known as individual investors, are also starting to participate in the market for crypto. In the future, as more people are educated about cryptocurrency and investing in it this could result in an increase in demand and consequently higher prices.
Growing awareness and acceptance of crypto
As the crypto market continues to mature increasing numbers of people are beginning to become aware about and appreciate it. As understanding and acceptance of crypto grows it could result in more people buying or holding cryptocurrency, and this can raise prices.
tonic crypto airdrop
The Decentralized Finance (DeFi) is an emerging area of the crypto market that allows financial services to be built upon blockchain technology. As DeFi continues to grow 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 grows as more and more businesses are beginning accepting crypto payments as a method 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 state-owned instruments for investing, are starting to explore crypto as an asset class. As more of these funds devote a percentage of their portfolio to crypto, it could result in a rise in demand and more expensive prices.
Utilization of crypto to make international payments
One of the major benefits of crypto is its ability to facilitate quick and inexpensive cross-border payments. As more individuals and businesses begin to use crypto for international transactions, it could result in increased the demand for it and a rise in prices.
Increasing numbers of crypto ATM’s
The number of crypto ATM’s continue to increase it will be more convenient for consumers to purchase and store cryptocurrency, which can increase demand and price.
Development of security tokens
Security tokens, also known as digital assets that signify ownership in an asset such as real estate or stock are rapidly expanding segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, this can lead to a higher demand and higher prices for crypto.
More adoption by merchants
With the increasing number of merchants accept cryptocurrency as a method of payment, it will make it more convenient for people to utilize and store crypto, which can increase demand and price.
So, will crypto increase in 2023? The only way to know is time. However, with these aspects in mind, it’s possible that the crypto market could have a rebound by 2023. If you’re in it for the long haul, being patient and disciplined is crucial.