It’s been a difficult ride for the crypto market until 2022. In November the market had dropped by 70% from its previous peak on November 20, 2021. When things were looking down after the FTX crash turned things even worse. So, will the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin, has seen its fair share of drops in the past. Every time, it’s bounced back by a massive increase.
For instance, in 2013, Bitcoin reached a peak of $1,160. Then it fell for more than a year, reaching a low of $150. In 2017 it broke that record and hit a record high of $19,600. In 2018, the price was at $3,100. And in 2020, the price broke through that resistance and reached a new high of $68,000 in November 2021. Just like that, we’ve seen 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 before, fall-offs tend to be followed by a long bull run, which 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 the last few years. With more and more companies and industries embracing it, its usage and acceptance is rising. From gaming to finance cryptocurrency is being utilized in a myriad of ways. This growing demand can lead to more people getting involved in the market which could drive the prices up.
Increased institutional interest in cryptocurrency
In recent times, we’ve seen a growing demand from investors of institutional scale in cryptocurrency. From hedge funds to banks and even large corporations are beginning to investigate the possibilities for crypto-based assets. The increasing interest from institutions could provide more stability to the crypto market and could 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 rules for crypto. This will help draw more investors as well as increase the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that underlies many cryptocurrency, 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, which could increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Blockchain and cryptocurrency technology is at the very beginning of development. As progress is made in areas such as scalability and security, the potential of crypto 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 looking for safe haven assets such as cryptocurrency and gold. Since the economic outlook for the world is uncertain it could result in an increase in demand for crypto and higher prices.
Interest from retail investors
Investors from institutions aren’t the only people who are interested in cryptocurrency. Retail investors, also known as individual investors are also beginning to get involved in the cryptocurrency market. With increasing numbers of everyday people become aware of crypto and how to invest 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 crypto
As the crypto market is maturing as more and more people are beginning to learn about and understand it. As the awareness and acceptance grows of crypto, this could lead to more people purchasing and holding crypto, which could raise prices.
where to buy ebt crypto
Financial decentralization (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 become available, this could lead to increased adoption and more expensive prices for crypto.
The development of crypto payment methods
As the market for crypto grows as more and more businesses are starting accepting crypto payments as a form 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 owned by the state as instruments for investing, are now beginning to show interest in cryptocurrency as a possible asset class. As more funds devote a percentage of their portfolio to crypto, this could result in a rise in demand and higher prices.
Utilization of crypto to make international payments
One of the major benefits of cryptocurrency is its ability to make swift and affordable cross-border transactions. As more and more people and businesses start to utilize cryptocurrency for international transactions this can lead to a rise in demand and higher prices.
An increasing number of crypto ATM’s
The number of crypto ATM’s continue to increase it will be more convenient for individuals to purchase and hold crypto, which could drive up demand and prices.
The development of security tokens
Security tokens, also known as digital assets that are used to represent ownership of an asset, like stocks or real estate is a fast-growing segment of the cryptocurrency market. With the increasing number of security tokens being created and traded, it could lead to increased demand, and thus higher prices for crypto.
A greater adoption rate by merchants
With the increasing number of retailers accept crypto as a form of payment, this will make it more convenient for customers to use and hold cryptocurrency, which will boost demand and increase prices.
So, will crypto increase in 2023? Only time will tell. However, with these aspects in mind, it’s likely that the crypto market could be able to see a rebound in 2023. For those looking to invest for the long run, being patient and disciplined is essential.