It’s been a rough ride for the crypto market until 2022. In November, the market had dipped by more than 70 percent from its previous high at the end of November. Just when the market was going downhill and down, the FTX crash turned things worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen its fair share of dips over the years. Each time, it’s rebounded by a massive rally.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for a full year, reaching a low of $150. However, in 2017, it broke that record and reached a new record high of $19,600. Fast forward to 2018, it was trading at $3,100. And in 2020, the price broke that resistance and reached a new highest of $68,000 in November 2021. And just like that, we’ve witnessed another drop. However, history has shown us that at the end of every dip there’s a bull-run.
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 overcomes the resistance set 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
Blockchain technology and cryptography have made significant progress in recent years. With more and more businesses and industries adopting it, its usage and acceptance is rising. From gaming to finance cryptocurrency is being utilized in many ways. The growing popularity of crypto could result in more people getting involved in the crypto market and, in turn, drive the prices up.
The rise in interest of institutions in cryptocurrency
In the last few years we’ve witnessed a rising demand from investors of institutional scale in crypto. From hedge funds to banks numerous large institutions are beginning to investigate the possibilities of crypto assets. This increased interest from institutions could bring more stability to the crypto market and could lead to greater prices.
As the crypto market grows as it matures, governments all over the world are starting to create more favorable rules for cryptocurrency. This could help attract more investors and increase the acceptance of crypto in general.
Blockchain has many more applications.
The technology that underlies many cryptocurrencies, blockchain, has a wide range of potential use cases beyond the realm of financial transactions. From supply chain management to voting systems, more industries are exploring ways they can utilize blockchain technology. This could stimulate more investment and excitement in crypto.
Technologies are constantly evolving.
Crypto and blockchain technology are at the very beginning of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will grow. This could lead to greater use and increase in prices.
Rising global economic uncertainty
In the current economic uncertainty brought on through the COVID-19 pandemic as well as other factors increasing numbers of investors are looking for safe haven investments like gold and crypto. As the global economic situation is uncertain it could result in increased demand for crypto and more expensive prices.
Interest from retail investors
Investors from institutions aren’t the only people who are interested in crypto. Retail investors, also known as individual investors are also beginning to get involved in the cryptocurrency market. As more and more people learn about crypto and how to invest in it, this could lead to increased demand and higher prices.
The growing awareness and acceptance of crypto
As the market for crypto is maturing increasing numbers of people are starting to learn about it and comprehend the concept. As awareness and acceptance of cryptocurrency grows, this could lead to increasing numbers of people purchasing and holding crypto, which could drive up prices.
turbotax crypto airdrop
Financial decentralization (DeFi) is a rapidly growing area of the crypto market, which allows finance services developed on top of blockchain technology. As DeFi continues to grow and more projects and platforms come online, this could lead to increased adoption and increased prices for crypto.
The development of crypto payment methods
As the crypto market grows, more and more companies are beginning using crypto to be a form of payment. This could lead to increased usage of crypto in daily transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
Sovereign wealth funds, which are government-owned investment vehicles, are starting to show interest in crypto as a potential asset class. As more of these funds dedicate a part of their assets to digital currencies, it could increase demand and higher prices.
Use of crypto for payment across borders
One of the main advantages of cryptocurrency is its ability to facilitate swift and affordable cross-border transactions. As more businesses and individuals are beginning to make use of 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 for crypto continue to increase it will be more convenient for individuals to purchase and keep crypto, which could increase demand and price.
The development of security tokens
Security tokens, or digital assets that are used to represent ownership in an asset like real estate or stock, are a rapidly growing segment of the cryptocurrency market. As more security tokens are created and traded, it could result in a rise in demand and consequently higher prices for crypto.
More adoption by merchants
With the increasing number of retailers accept crypto as a means of payment, it will make it easier for consumers to hold and use cryptocurrency, which will drive up demand and prices.
So, will crypto increase in 2023? Only time will tell. With these things in mind, it’s possible that the crypto market could have a rebound by 2023. For those committed to the long run Being patient and disciplined will be key.