It’s been a tough experience for the crypto market in 2022. As of November the market had dropped by 70% from its previous peak in November 2021. And just when things were getting worse after the FTX crash turned things even worse. What is the likelihood that the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has experienced its fair share of dips over the years. Each time, it has bounced back with a huge rise.
In 2013, for instance, Bitcoin reached a peak of $1,160. Then it fell for over a year before reaching a bottom of $150. However, in 2017, it broke that record, and hit a new record high of $19,600. Then, in 2018, and it was trading at $3,100. And in 2020, the price broke that resistance and reached 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 at the end of every dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen previously, dips are usually followed by a prolonged bull run that finally surpasses the resistance created by the previous market’s highest price. This pattern is evident not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain technology and cryptography have come a long way in recent years. With more and more companies and industries adopting the technology, its use and acceptance is increasing. From banking to gaming, crypto is being used in a variety of ways. And this growing use case could result in more people being involved in the crypto market which could increase the price.
The rise in interest of institutions in crypto
In recent years we’ve noticed a growing interest from institutional investors in cryptocurrency. From hedge funds to banks numerous large institutions are now exploring the possibilities in crypto currencies. The increased interest of institutions can bring stability to the crypto market and lead to more expensive prices.
Regulations from the Government
As the crypto market is maturing, governments around the world are beginning to develop more favorable regulations for crypto. This is likely to attract more investors and increase the acceptance of crypto in general.
A broader range of blockchain applications
The technology that is the basis of many cryptocurrencies, blockchain, has a wide range of applications that go that go beyond financial transactions. In addition to supply chain management, voting and other systems industries are starting to explore how they can benefit from blockchain technology, which could drive more investment and interest in crypto.
Technology advancements
Crypto and blockchain technology are still in the early stages of development. As progress is made in areas such as security and scalability, potential of cryptocurrency assets will continue to expand. This could lead to more use and increase in prices.
Rising global economic uncertainty
In the current instability in the economy caused through the COVID-19 pandemic, as well as other causes, more and more investors are looking for safe haven assets like gold and crypto. Because the global economic climate is uncertain, this could lead to more demand for crypto as well as increased prices.
Interest from retail investors
Institutional investors aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, also known as individual investors, are also starting to get involved in the market for crypto. As more and more people become aware of cryptocurrency and investing in it, this could lead to an increase in demand and consequently higher prices.
The growing awareness and acceptance of crypto
As the market for crypto continues to mature increasing numbers of people are beginning to become aware about it and comprehend it. As understanding and acceptance of cryptocurrency grows, this could lead to more people buying or holding cryptocurrency, and this could increase prices.
where to buy chz crypto
Decentralized finance (DeFi) is an emerging area of the crypto market that allows financial services to be created upon blockchain technology. As DeFi expands and more projects and platforms are launched, it could lead to increased adoption and higher prices for crypto.
The development of crypto payment methods
As the market for crypto is growing as more and more businesses are beginning to accept crypto as a means of payment. This could lead to increased use of crypto in everyday transactions and an increase in the cost of transactions.
The increased investment of sovereign wealth funds
The sovereign wealth fund, also known as government-owned instruments for investing, are starting to look at cryptocurrency as a possible asset class. As more funds devote a percentage of their assets to digital currencies, it could lead to increased demand and higher prices.
Cryptocurrency is used for payment across borders
One of the biggest benefits of cryptocurrency is its ability to make quick and inexpensive cross-border payments. As more and more people and businesses begin to use crypto for international transactions, it could result in increased demand and higher prices.
The number of ATMs that accept crypto is increasing.
As the number of crypto ATM’s increase, it will become easier for consumers to purchase and keep cryptocurrency, which can increase demand and price.
Development of security tokens
Security tokens, which are digital assets that are used to represent ownership in an asset like stocks or real estate is a fast-growing area of the crypto market. Since more and more security tokens will be created and traded, it could lead to increased demand and consequently higher rates for the crypto.
More adoption by merchants
With the increasing number of merchants begin accepting crypto as a means of payment, it will make it more convenient for consumers to hold and use cryptocurrency, which will increase demand and price.
So, will crypto rise in 2023? The only way to know is time. But with these factors being considered, it’s possible that the crypto market could see a recovery in 2023. For those in it for the long haul, being patient and disciplined is crucial.