It’s been a tough journey for the cryptocurrency market through 2022. As of November the market had dropped by more than 70 percent from the previous high at the end of November. And just when things were getting worse after the FTX crash turned things even more dire. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has had its fair share of dips in the past. Every time, it’s rebounded with a huge increase.
For instance, in 2013, 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 the record, and hit a new highest of $19,600. In 2018, the price was at $3,100. In 2020, it broke that resistance and hit a new high of $68,000 in November 2021. And just like that, we’ve witnessed another drop. However, the past has proven that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed in the past, dips tend to be followed by a lengthy bull run that eventually overcomes the resistance set by the market’s previous highest price. This is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have progressed a lot in recent years. With more and more businesses and industries embracing the technology, its use and acceptance is rising. From banking to gaming cryptocurrency is being utilized in a myriad of ways. The growing popularity of crypto can lead to more people being involved in the market which could increase the price.
Increased institutional interest in crypto
In recent times, we’ve seen a growing interest from institutional investors in crypto. From banks to hedge funds numerous large institutions are now exploring the possibilities of crypto assets. The increased interest of institutions could bring more stability to the crypto market and lead to higher prices.
Government regulations
As the crypto market is maturing as it matures, governments all over the world are beginning to develop more favorable regulations for crypto. This is likely to attract more investors and increase the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that underlies the majority of cryptocurrencies, blockchain is a broad range of possible applications that go beyond financial transactions. For example, from supply chain management and voting, many industries are starting to explore how they can utilize blockchain technology, which could stimulate more investment and excitement in crypto.
Technology advancements
Blockchain technology and cryptography are still in the beginning stages of development. As progress is made in areas such as scalability and security, the potential of crypto assets will expand. This could lead to greater acceptance and higher prices.
Global economic uncertainty is growing
In the current instability in the economy caused due to the COVID-19 pandemic as well as other factors many investors are starting to look for safe haven investments like cryptocurrency and gold. Because the global economic climate is uncertain and uncertain, this could lead to more demand for crypto as well as more expensive prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only ones showing interest in crypto. Retail investors, or individual investors, are also starting to participate in the cryptocurrency market. With increasing numbers of people become aware of crypto and how to invest in it this could result in more demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market is maturing as more and more people are beginning to become aware about and appreciate the concept. As understanding and acceptance grows of crypto, it will lead to more people purchasing as well as holding the crypto that can increase prices.
turnkey crypto exchange
The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market that enables the provision of financial services developed on top of blockchain technology. As DeFi continues to grow and more projects and platforms 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 as more and more businesses are starting using crypto to be a form of payment. This could lead to increased use of crypto in regular transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as government-owned investments, are now beginning to explore crypto as a potential asset class. As more funds devote a percentage of their portfolio to crypto, it could lead to increased demand and increased prices.
Cryptocurrency is used for international payments
One of the major benefits of crypto is the ability to make swift and affordable cross-border transactions. As more individuals and businesses begin to use cryptocurrency for international transactions this can lead to a rise in demand and higher costs.
An increasing number of crypto ATM’s
With the amount of ATMs that accept crypto increase, it will become easier for consumers to purchase and store cryptocurrency, which can boost demand and increase prices.
The development of security tokens
Security tokens, which are digital assets that signify ownership in an asset like real estate or stock are rapidly expanding segment of the cryptocurrency market. With the increasing number of security tokens being issued and traded, it could lead to increased demand and consequently higher rates for the crypto.
A greater adoption rate by merchants
As more and more businesses accept crypto as a form of payment, this makes it easier for consumers to use and hold cryptocurrency, which will boost demand and increase prices.
Will crypto be on the grow in 2023? Only time will tell. But with these factors to consider, it’s likely that the crypto market could be able to see a rebound in 2023. For those committed to the long run Being patient and disciplined is essential.