It’s been a tough ride for the crypto market through 2022. In November the market had dropped by more than 70 percent from its previous high in November 2021. When things were going downhill, the FTX crash turned them worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced many drops in the past. Every time, it’s bounced back with a big increase.
In 2013, for instance, Bitcoin reached a peak of $1,160. It then plummeted for over a year, reaching a low of $150. In 2017 it broke that record and reached a new high of $19,600. Then, in 2018, it was trading at $3,100. In 2020, the price broke through that resistance and reached a new peak of $68,000 in the month of November 2021. Just like that, we’ve had another dip. However, history has shown us that after each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
As we’ve seen in the past, dips tend to be followed by a lengthy bull run that finally overcomes the resistance set by the previous market’s highest price. This pattern can be seen in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have made significant progress in recent years. With more and more businesses and industries embracing the technology, its use and acceptance is increasing. From finance to gaming cryptocurrency is being utilized in a variety of ways. And this growing use case could lead to more people being involved in the market, which in turn could increase the price.
The rise in interest of institutions in crypto
In recent years we’ve witnessed a rising interest from institutional investors in cryptocurrency. From hedge funds to banks, many large institutions are starting to explore the possibilities of crypto assets. The increasing interest from institutions could provide more stability to the market for crypto and lead to more expensive prices.
As the crypto market grows and mature, governments across the globe are beginning to develop more favorable regulations for cryptocurrency. This could help attract more investors and boost the mainstream adoption of crypto.
More use cases for blockchain
The technology that is the basis of many cryptocurrencies, blockchain, has a wide range of possible applications beyond just financial transactions. From supply chain management to voting systems, more industries are starting to explore how they can make use of blockchain technology, which could increase investment and enthusiasm in crypto.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is still in the early stages of development. As advancements continue to be made in areas like scalability and security, the potential of crypto assets will continue to increase. This could lead to more adoption and higher prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty brought on through the COVID-19 pandemic and other factors many investors are starting to look for safe haven assets like bitcoin and even gold. As the global economic situation remains uncertain it could result in more demand for crypto as well as more expensive prices.
Retail investors are able to earn interest
Institutional investors aren’t the only people who are interested in cryptocurrency. Retail investors, or even individual investors, are also starting to invest in the market for crypto. In the future, as more people are educated about cryptocurrency and investing in it, this could lead to an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting cryptocurrency
As the crypto market grows increasing numbers of people are beginning to learn about it and comprehend it. As the awareness and acceptance of crypto grows, this could lead to more people buying as well as holding the crypto that could increase prices.
Decentralized finance (DeFi) is an emerging area of the crypto market that enables the provision of financial services built using blockchain technology. As DeFi continues to grow and more platforms and projects become available, this could result in increased use and increased prices for crypto.
Advances in crypto-based payment methods
As the crypto market is growing increasing numbers of companies are starting using crypto to be a means of payment. This could result in increased usage of crypto in daily transactions, and a rise in prices.
The increased investment of sovereign wealth funds
Sovereign wealth funds, which are government-owned investment vehicles, are starting to show interest in crypto as an asset class. As more of these funds devote a percentage of their portfolio to crypto, it could increase demand and higher prices.
Cryptocurrency is used for international payments
One of the main advantages of cryptocurrency is its capability to perform swift and affordable cross-border transactions. As more individuals and businesses begin to use cryptocurrency for international transactions it could result in increased demand and higher costs.
An increasing number of crypto ATM’s
The number of ATMs for crypto increase it will be easier for individuals to purchase and store crypto, which will drive up demand and prices.
Development of security tokens
Security tokens, also known as digital assets that are used to represent ownership of an asset, such as stock or real estate is a fast-growing area of the crypto market. As more security tokens are created and traded, it could lead to increased demand and higher prices for crypto.
A greater adoption rate by merchants
With the increasing number of businesses accept crypto as a means of payment, it will make it more convenient for people to utilize and store crypto, which can drive up demand and prices.
Will crypto be on the rise in 2023? Only time will tell. However, with these aspects in mind, it’s possible that the crypto market could have a rebound by 2023. For those committed to the long-term patience and discipline is crucial.