It’s been a difficult experience for the crypto market in 2022. By November, the market had dipped by 70% from its previous peak in November 2021. Just when the market was looking down after the FTX crash turned things more dire. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many dips over the years. Each time, it’s bounced back by a massive rise.
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 hit a record high of $19,600. In 2018, and it was trading at $3,100. And in 2020, the price broke through that resistance and hit a new peak of $68,000 in the month of November 2021. Then, just like that we’ve seen another dip. But history shows us that following 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 long bull run that eventually breaks through the resistance created by the market’s previous highest price. This pattern can be seen in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in recent years. With more and better companies and industries adopting it, its usage and acceptance is increasing. From gaming to finance the use of crypto is increasing in a variety of ways. This growing demand could lead to more people being involved in the market, which in turn could increase the price.
A rise in the interest of institutions for cryptocurrency
In recent times we’ve noticed a growing interest from institutional investors in crypto. From hedge funds to banks and even large corporations are now exploring the possibilities in crypto currencies. The increased interest of institutions could bring more stability to the market for crypto and result in greater prices.
Government regulations
As the market for crypto continues to mature and mature, governments across the globe are beginning to develop more favorable rules for cryptocurrency. This will help draw more investors and increase the mainstream adoption of crypto.
Blockchain has many more applications.
The underlying technology behind many cryptocurrencies, blockchain, offers a variety of applications that go beyond the realm of financial transactions. In addition to supply chain management, voting and other systems companies are starting to explore how they can benefit from blockchain technology, which could increase investment and enthusiasm in crypto.
Advancements in technology
Blockchain and cryptocurrency technology is 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 expand. This could lead to more adoption and higher prices.
Uncertainty in the global economy
With the ongoing instability in the economy caused due to the COVID-19 pandemic and other factors many investors are looking for safe haven investments like cryptocurrency and gold. As the global economic situation is uncertain, this could lead to an increase in demand for crypto and more expensive prices.
Interest from retail investors
Investors from institutions aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, also known as individual investors, are also starting to invest in the crypto market. As more and more everyday people learn about cryptocurrency and investing in it this could result in an increase in demand and consequently higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto continues to mature, more and more people are beginning to learn about it and comprehend it. As awareness and acceptance grows of crypto, this could lead to increasing numbers of people purchasing as well as holding the crypto that can raise prices.
what does white paper mean in crypto
The Decentralized Finance (DeFi) is a rapidly growing area of the crypto market that allows the provision of financial services created upon blockchain technology. As DeFi grows and more platforms and projects come online, this could result in increased use and increased prices for crypto.
The development of crypto payment methods
As the crypto market continues to grow, more and more companies are starting using crypto to be a method of payment. This could lead to increased use of crypto in everyday transactions, and a rise in prices.
The increased investment of sovereign wealth funds
Sovereign wealth funds, which are state-owned investments, are beginning to look at crypto as an asset class. As more of these funds devote a percentage of their portfolio to crypto, it could result in a rise in demand and higher prices.
Utilization of crypto to make payment across borders
One of the main advantages of crypto is the ability to facilitate quick and inexpensive cross-border payments. As more and more people and businesses begin to use crypto for international transactions, this could lead to increased demand and higher costs.
Increasing numbers of crypto ATM’s
With the amount of crypto ATM’s increase it will be more convenient for people to buy and store crypto, which could increase demand and price.
Development of security tokens
Security tokens, or digital assets that signify ownership in an asset like stock or real estate is a fast-growing sector of the crypto market. Since more and more security tokens will be created and traded, this could lead to increased demand and higher prices for crypto.
A greater adoption rate by merchants
In the event that more retailers start accepting cryptocurrency as a method of payment, this will make it easier for consumers to utilize and store crypto, which can drive up demand and prices.
So, will crypto increase in 2023? The only way to know is time. But with these factors being considered, it’s likely that the crypto market could be able to see a rebound in 2023. For those committed to the long-term, being patient and disciplined is crucial.