It’s been a tough journey for the cryptocurrency market until 2022. By November the market had dropped by 70 percent from its previous high in November 2021. And just when things were looking down and down, the FTX crash turned them more dire. What is the likelihood that the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin has experienced many dips in the past. Every time, it’s rebounded with a huge rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for more than a year, reaching a low of $150. However, in 2017, it broke that record, and hit a new highest of $19,600. Fast forward to 2018, it was trading at $3,100. And in the year 2020 it struck through the resistance, and reached a record highest of $68,000 in November 2021. Then, just like that we’ve had another dip. However, the past has proven 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 are typically followed by a prolonged bull run that eventually surpasses the resistance created by the market’s previous highest price. This is evident in not just Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have made significant progress in the last few years. With more and more companies and industries embracing it, its usage and acceptance is rising. From finance to gaming, crypto is being used in many ways. And this growing use case can lead to increasing participation in the market which could drive the prices up.
Increased institutional interest in crypto
In recent years, we’ve seen a growing interest from institutional investors in crypto. From banks to hedge funds and even large corporations are now exploring the possibilities in crypto currencies. This increased interest from institutions could provide more stability to the market for crypto and could lead to more expensive prices.
As the market for crypto is maturing as it matures, governments all over the world are starting to create more favorable regulations for cryptocurrency. This will help draw more investors and increase the adoption rate of crypto.
More use cases for blockchain
The technology that is the basis of many cryptocurrencies, blockchain, has a wide range of applications that go beyond just financial transactions. From supply chain management to voting systems, more industries are starting to explore how they can utilize blockchain technology. This 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 such as scalability and security, the potential of cryptocurrency assets will continue to increase. This could lead to greater adoption and higher prices.
Rising global economic uncertainty
In the current economic uncertainty 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. Since the economic outlook for the world is uncertain, this could lead to an increase in demand for crypto and increased prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in ones showing interest in crypto. Retail investors, or individual investors, are also starting to get involved in the market for crypto. As more and more people learn about crypto and how to invest in it this could result in increased demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto grows increasing numbers of people are beginning to become aware about it and comprehend the concept. As awareness and acceptance of crypto grows it could result in increasing numbers of people purchasing or holding cryptocurrency, and this could increase prices.
what to do with crypto profits
The Decentralized Finance (DeFi) is an emerging area of the crypto market that allows financial services to be developed using blockchain technology. As DeFi continues to grow and more platforms and projects come online, this will lead to a rise in adoption and higher prices for crypto.
The development of crypto payment methods
As the crypto market continues to grow, more and more companies are starting accepting crypto payments as a means of payment. This could result in increased use of crypto in everyday transactions, and a rise in prices.
More investment from sovereign wealth funds
These funds are state-owned investment vehicles, are beginning to explore crypto as a potential asset class. As more of these funds devote a percentage of their portfolio to crypto, it could increase demand and higher prices.
Utilization of crypto to make payment across borders
One of the major benefits of cryptocurrency is its capability to perform quick and inexpensive cross-border payments. As more businesses and individuals are beginning to make use of cryptocurrency for international transactions this can lead to a rise in demand and higher costs.
An increasing number of crypto ATM’s
The number of ATMs that accept crypto increase it will be more convenient for people to buy and hold cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, also known as digital assets that represent ownership of an asset, like real estate or stock, are a rapidly growing area of the crypto market. With the increasing number of security tokens being created and traded, it can lead to a higher demand and higher costs for cryptocurrency.
More adoption by merchants
In the event that more businesses start accepting cryptocurrency as a method of payment, it will make it more convenient for people to use and hold crypto, which can boost demand and increase prices.
So, is crypto likely to increase in 2023? Only time will tell. With these things being considered, it’s possible that the crypto market could have a rebound by 2023. If you’re committed to the long haul, being patient and disciplined is essential.