It’s been a rough ride for the crypto market through 2022. In November the market was down by 70% from its previous peak in November 2021. When things were going downhill, the FTX crash made them look worse. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced its fair share of dips in the past. Each time, it’s bounced back by a massive rise.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for a full year before hitting a low of $150. In 2017, it broke that record and reached a new high of $19,600. Fast forward to 2018, and it was trading at $3,100. In 2020, the price broke through the resistance and reached a new peak of $68,000 in the month of November 2021. Then, 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
Similar to what we’ve witnessed before, fall-offs are typically followed by a prolonged bull run that finally overcomes the resistance set by the previous market’s highest price. This is evident in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in the last few years. With more and better companies and industries adopting it, its usage and acceptance is growing. From banking to gaming the use of crypto is increasing in a variety of ways. And this growing use case could result in more people getting involved in the market and, in turn, drive the prices up.
Increased institutional interest in crypto
In recent times we’ve noticed a growing demand from investors of institutional scale in cryptocurrency. From banks to hedge funds, many large institutions are beginning to investigate the potential for crypto-based assets. The increasing interest from institutions could provide more stability to the market for crypto and result in higher prices.
Regulations of the government
As the crypto market grows as it matures, governments all over the world are starting to create more favorable regulations for crypto. This could help attract more investors as well as increase the acceptance of crypto in general.
A broader range of blockchain applications
The underlying technology behind many cryptocurrencies, blockchain, is a broad range of applications that go beyond just financial transactions. From supply chain management to voting systems, more and more industries are starting to explore how they can benefit from blockchain technology. This will drive more investment and interest in crypto.
Advancements in technology
Crypto and blockchain technology are still in the beginning stages of development. As advancements continue to be made in areas like security and scalability, potential of cryptocurrency assets will continue to grow. This could lead to greater use and increase in prices.
Rising global economic uncertainty
With the ongoing economic uncertainty caused by the COVID-19 pandemic, as well as other causes many investors are starting to look for safe haven assets such as bitcoin and even gold. Since the economic outlook for the world is uncertain and uncertain, this could lead to an increase in demand for crypto and increased prices.
Interest from retail investors
The institutional investors aren’t alone in people who are interested in cryptocurrency. Retail investors, or individual investors, are also starting to invest in the cryptocurrency market. With increasing numbers of everyday people are educated about cryptocurrency and investing in it This could result in increased demand and higher prices.
Growing awareness and acceptance of crypto
As the crypto market grows increasing numbers of people are beginning to learn about it and comprehend the concept. As awareness and acceptance of crypto grows it could result in more people buying or holding cryptocurrency, and this could raise prices.
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The Decentralized Finance (DeFi) is an area that is rapidly expanding in the crypto market that enables financial services to be built using blockchain technology. As DeFi continues to grow and more projects and platforms come online, this will lead to a rise in adoption and more expensive prices for crypto.
Advances in crypto-based payment methods
As the market for crypto grows, more and more companies are starting using crypto to be a means of payment. This could lead to an increase in the use of crypto in regular transactions, and a rise in prices.
More investment from sovereign wealth funds
The sovereign wealth fund, also known as owned by the state as investments, are starting to show interest in cryptocurrency as a possible asset class. As more of these funds allocate a portion or their entire portfolios to cryptocurrency, this could lead to increased demand and higher prices.
Utilization of crypto to make cross-border payments
One of the major benefits of cryptocurrency is its ability to make quick and inexpensive cross-border payments. As more and more people and businesses start to utilize crypto for international transactions, it could result in increased demand and higher prices.
Increasing numbers of crypto ATM’s
With the amount of crypto ATM’s increase it will be easier for people to buy and store cryptocurrency, which can drive up demand and prices.
Development of security tokens
Security tokens, or digital assets that represent ownership of an asset, such as stocks or real estate, are a rapidly growing sector of the crypto market. As more security tokens are created and traded, it could lead to increased demand and higher rates for the crypto.
More adoption by merchants
As more and more businesses begin accepting crypto as a form of payment, this will make it easier for customers to use and hold cryptocurrency, which will boost demand and increase prices.
So, is crypto likely to rise in 2023? The only way to know is time. However, with these aspects to consider, it’s likely that the cryptocurrency market will see a recovery in 2023. For those looking to invest for the long run patience and discipline will be key.