It’s been a difficult ride for the crypto market in 2022. In November the market had dropped by more than 70% from its previous peak in November 2021. Just when the market was getting worse after the FTX crash made them look worse. So, will the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has had many dips over the years. Every time, it’s rebounded by a massive increase.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for a full year, reaching a low of $150. In 2017 it broke that record and reached a new highest of $19,600. In 2018, and it was trading at $3,100. In 2020, the price broke that resistance, and reached a record highest of $68,000 in November 2021. Then, just like that we’ve had another dip. But history shows us that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
As we’ve seen before, fall-offs tend to be followed by a lengthy bull run that eventually breaks through the resistance created by the previous market’s highest price. This is evident in more than Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in the last few years. With more and more companies and industries taking to the technology, its use and acceptance is growing. From banking to gaming cryptocurrency is being utilized in many ways. The growing popularity of crypto could result in increasing participation in the market and, in turn, increase the price.
A rise in the interest of institutions for crypto
In the last few years we’ve witnessed a rising demand from investors of institutional scale in cryptocurrency. From hedge funds to banks, many large institutions are beginning to investigate the possibilities for crypto-based assets. The increasing interest from institutions can bring stability to the crypto market and lead to more expensive prices.
Regulations of the government
As the crypto market continues to mature and mature, governments across the globe are beginning to establish more favorable regulations for crypto. This is likely to attract more investors as well as increase the acceptance of crypto in general.
More use cases for blockchain
The technology that is the basis of many cryptocurrency, blockchain, has a wide range of applications that go that go beyond 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 stimulate more investment and excitement in cryptocurrency.
Technology advancements
Crypto and blockchain technology are still in the beginning stages of development. As advances continue to be made in areas like scalability and security, the potential of crypto assets will continue to grow. This could result in more use and increase in prices.
Uncertainty in the global economy
Due to the constant economic uncertainty caused by the COVID-19 pandemic, as well as other causes increasing numbers of investors are beginning to look for safe haven investments like gold and crypto. Because the global economic climate remains uncertain and uncertain, this could lead to more demand for crypto as well as increased prices.
Interest from retail investors
Institutional investors aren’t the only ones showing interest in cryptocurrency. Retail investors, or even individual investors, are also starting to participate in the cryptocurrency market. In the future, as more everyday people learn about cryptocurrency and investing in it this could result in increased demand and higher prices.
The growing awareness and acceptance of crypto
As the market for crypto continues to mature increasing numbers of people are beginning to become aware about it and comprehend it. As the awareness and acceptance of cryptocurrency grows, this could lead to more people buying or holding cryptocurrency, and this can raise prices.
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The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market that allows the provision of financial services built using blockchain technology. As DeFi grows and more platforms and projects become available, this could result in increased use and higher prices for crypto.
Developments in crypto payment methods
As the market for crypto continues to grow increasing numbers of companies are beginning to accept crypto as a means of payment. This could lead to an increase in the use of crypto in everyday transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
These funds are government-owned instruments for investing, are starting to look at crypto as an asset class. As more funds allocate a portion of their portfolio to crypto, it could result in a rise in demand and higher prices.
Utilization of crypto to make cross-border payments
One of the biggest benefits of cryptocurrency is its capability to perform fast and cheap cross-border payments. As more businesses and individuals begin to use cryptocurrency for international transactions, this can lead to a rise in demand and higher prices.
The number of ATMs that accept crypto is increasing.
The number of ATMs that accept crypto continue to grow it will be more convenient for consumers to purchase and hold crypto, which could drive up demand and prices.
The development of security tokens
Security tokens, or digital assets that signify ownership of an asset, like stock or real estate are rapidly expanding segment of the cryptocurrency market. With the increasing number of security tokens being created and traded, this can lead to a higher demand and consequently higher costs for cryptocurrency.
Merchants are more likely to adopt the concept.
With the increasing number of businesses begin accepting cryptocurrency as a method of payment, it will make it more convenient for people to hold and use crypto, which can boost demand and increase prices.
So, will crypto grow in 2023? The only way to know is time. However, with these aspects in mind, it’s likely that the cryptocurrency market will have a rebound by 2023. And for those who are in it for the long run, being patient and disciplined is essential.