It’s been a difficult journey for the cryptocurrency market in 2022. By November the market had dropped by 70% from its previous peak at the end of November. When things were looking down and down, the FTX crash turned them more dire. The question is, can the crypto market be able to recover by 2023?
Crypto Market Dips are Cyclical
The market for crypto, particularly Bitcoin, has seen its fair share of dips over the years. Each time, it’s bounced back with a huge increase.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for more than a year before hitting a low of $150. However, in 2017 it broke that record and hit a record record high of $19,600. Fast forward to 2018, it was trading at $3,100. And in 2020, the price broke through the resistance and hit a new high of $68,000 in November 2021. Just like that, we’ve seen another dip. However, the past has proven that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
As we’ve seen previously, dips are usually followed by a long bull run that eventually surpasses the resistance created by the previous market’s highest price. This pattern is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has progressed a lot in recent years. With more and more companies and industries taking to it, its usage and acceptance is growing. From finance to gaming, crypto is being used in many ways. The growing popularity of crypto could lead to more people getting involved in the market, which in turn could boost prices.
Increased institutional interest in cryptocurrency
In the last few years we’ve witnessed a rising interest from institutional investors in cryptocurrency. From hedge funds to banks and even large corporations are starting to explore the potential for crypto-based assets. This increased interest from institutions can bring stability to the crypto market and lead to greater prices.
Regulations of the government
As the crypto market continues to mature and mature, governments across the globe are starting to create more favorable rules for crypto. This will help draw more investors and increase the mainstream adoption of crypto.
More use cases for blockchain
The technology that underlies many cryptocurrency, blockchain, has a wide range of applications that go that go beyond financial transactions. For example, from supply chain management and voting, many industries are starting to explore how they can benefit from blockchain technology. This will increase investment and enthusiasm in cryptocurrency.
Advancements in technology
Blockchain and cryptocurrency technology is still in the early stages of development. As advances continue to be made in areas such as security and scalability, the potential of crypto assets will continue to increase. This could lead to greater adoption and higher prices.
Global economic uncertainty is growing
In the current economic uncertainty caused due to the COVID-19 pandemic, as well as other causes many investors are beginning to look for safe haven investments like bitcoin and even gold. Since the economic outlook for the world is uncertain, this could lead to an increase in demand for crypto and increased 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 beginning to invest in the market for crypto. In the future, as more people learn about crypto and how to invest in it This could result in more demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the market for crypto continues to mature as more and more people are beginning to learn about and understand it. As awareness and acceptance of crypto grows it could result in more people purchasing or holding cryptocurrency, and this could drive up prices.
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Financial decentralization (DeFi) is an emerging area of the crypto market that allows finance services developed upon blockchain technology. As DeFi continues to grow and more platforms and projects become available, this will lead to a rise in adoption and increased prices for crypto.
Developments in crypto payment methods
As the crypto market continues to grow increasing numbers of companies are starting using crypto to be a form of payment. This could result in increased use of crypto in everyday transactions and higher prices.
More investment from sovereign wealth funds
These funds are state-owned investments, are beginning to look at cryptocurrency as a possible asset class. As more of these funds dedicate a part or their entire portfolios to cryptocurrency, it could result in a rise in demand and increased prices.
Utilization of crypto to make cross-border payments
One of the major benefits of crypto is the capability to perform quick and inexpensive cross-border payments. As more businesses and individuals start to utilize cryptocurrency for international transactions it could result in increased demand and higher costs.
The number of ATMs that accept crypto is increasing.
The number of crypto ATM’s increase it will be easier for people to buy and hold crypto, which could increase demand and price.
The development of security tokens
Security tokens, which are digital assets that are used to represent ownership in an asset such as real estate or stock, are a rapidly growing sector of the crypto market. With the increasing number of security tokens being issued and traded, this could result in a rise in demand and consequently higher costs for cryptocurrency.
A greater adoption rate by merchants
As more and more retailers accept cryptocurrency as a method of payment, it will make it easier for consumers to utilize and store crypto, which could drive up demand and prices.
Will crypto be on the increase in 2023? The only way to know is time. With these things being considered, it’s possible that the crypto market will be able to see a rebound in 2023. And for those who are committed to the long haul Being patient and disciplined will be key.