It’s been a rough ride for the crypto market until 2022. By November, the market had dipped by 70 percent from the previous high on November 20, 2021. Just when the market was going downhill and down, the FTX crash turned them 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. Every time, it has bounced back by a massive rise.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year before reaching a bottom of $150. In 2017, it broke that record, and hit a new high of $19,600. Fast forward to 2018, it was trading at $3,100. In 2020, it broke through the resistance, and reached a record highest of $68,000 in 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
Just like we’ve seen before, fall-offs are usually followed by a prolonged bull run that eventually overcomes the resistance set by the previous market’s highest price. This is evident not only in Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has made significant progress in recent years. With more and more companies and industries embracing the technology, its use and acceptance is increasing. From gaming to finance cryptocurrency is being utilized in many ways. And this growing use case could result in more people getting involved in the crypto market which could drive the prices up.
A rise in the interest of institutions for cryptocurrency
In recent years we’ve witnessed a rising curiosity from institutions investing in crypto. From banks to hedge funds numerous large institutions are beginning to investigate the potential in crypto currencies. The increased interest of institutions could provide more stability to the market for crypto and lead to greater prices.
Regulations from the Government
As the crypto market continues to mature, governments around the world are starting to create more favorable regulations for crypto. This is likely to attract more investors and boost the adoption rate of crypto.
A broader range of blockchain applications
The underlying technology behind many cryptocurrencies, blockchain, is a broad range of possible applications beyond just financial transactions. For example, from supply chain management and voting, many and more industries are starting to explore how they can utilize blockchain technology, which could stimulate more investment and excitement in cryptocurrency.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is still in the early stages of development. As progress is made in areas such as security and scalability, the potential of cryptocurrency assets will continue to expand. This could lead to greater adoption and higher prices.
Global economic uncertainty is growing
In the current instability in the economy caused through the COVID-19 pandemic and other factors many investors are starting to look for safe haven investments like cryptocurrency and gold. Since the economic outlook for the world is uncertain, this could lead to more demand for crypto as well as increased prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only people who are interested in cryptocurrency. Retail investors, also known as individual investors are also beginning to invest in the crypto market. With increasing numbers of people are educated about crypto and how to invest in it, this could lead to an increase in demand and consequently higher prices.
Growing awareness and acceptance of cryptocurrency
As the market for crypto continues to mature increasing numbers of people are beginning to become aware about it and comprehend it. As awareness and acceptance of crypto grows, this could lead to more people buying as well as holding the crypto that can increase prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market that allows financial services to be built using blockchain technology. As DeFi continues to grow and more projects and platforms are launched, it will lead to a rise in adoption and higher prices for crypto.
The development of crypto payment methods
As the crypto market grows increasing numbers of companies are beginning to accept crypto as a method of payment. This could lead to an increase in the use of crypto in everyday transactions and higher prices.
The increased investment of sovereign wealth funds
The sovereign wealth fund, also known as government-owned investment vehicles, are beginning to explore cryptocurrency as a possible asset class. As more funds dedicate a part of their portfolio to crypto, this could lead to increased demand and higher prices.
Use of crypto for international payments
One of the major benefits of crypto is its capability to perform quick and inexpensive cross-border payments. As more and more people and businesses are beginning to make use of crypto for international transactions, this can lead to a rise in demand and higher costs.
Increasing numbers of crypto ATM’s
As the number of crypto ATM’s continue to increase, it will become easier for consumers to purchase and keep crypto, which could increase demand and price.
The development of security tokens
Security tokens, which are digital assets that represent ownership of an asset, like stocks or real estate is a fast-growing sector of the crypto market. With the increasing number of security tokens being created and traded, this could result in a rise in demand and higher prices for crypto.
Merchants are more likely to adopt the concept.
As more and more businesses start accepting cryptocurrency as a method of payment, this makes it easier for consumers to use and hold cryptocurrency, which will increase demand and price.
So, will crypto increase in 2023? The only way to know is time. But with these factors being considered, it’s possible that the crypto market could be able to see a rebound in 2023. If you’re committed to the long-term Being patient and disciplined is essential.