It’s been a difficult experience for the crypto market until 2022. In November the market had dropped by more than 70 percent from the previous high in November 2021. And just when things were getting worse after the FTX crash turned things even worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has had many dips in the past. Every time, it has bounced back with a huge increase.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for a full year, reaching a low of $150. In 2017, it broke the record and hit a record high of $19,600. Fast forward to 2018, and it was trading at $3,100. And in 2020, it broke through the resistance and hit a new highest of $68,000 in November 2021. Just like that, we’ve had another dip. However, the past has proven that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs are usually followed by a lengthy bull run that finally overcomes the resistance set by the previous high price. This pattern is evident in not just Bitcoin but also other cryptocurrencies.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in recent years. With more and more businesses and industries taking to it, its usage and acceptance is rising. From banking to gaming, crypto is being used in a myriad of ways. The growing popularity of crypto can lead to increasing participation in the crypto market which could increase the price.
Increased institutional interest in cryptocurrency
In recent years we’ve noticed a growing demand from investors of institutional scale in crypto. From hedge funds to banks numerous large institutions are starting to explore the possibilities for crypto-based assets. This increased interest from institutions could bring more stability to the market for crypto and lead to more expensive prices.
Regulations of the government
As the crypto market continues to mature, governments around the world are beginning to develop more favorable rules for crypto. This could help attract more investors and increase the mainstream adoption 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 that go beyond financial transactions. In addition to supply chain management, voting and other systems and more industries are beginning to look at ways they can utilize blockchain technology. This could stimulate more investment and excitement in crypto.
Technology advancements
Blockchain and cryptocurrency technology is still in the beginning stages of development. As advancements continue to be made in areas such as security and scalability, potential of cryptocurrency assets will continue to expand. This could result in more acceptance and higher prices.
Global economic uncertainty is growing
In the current economic uncertainty caused due to the COVID-19 pandemic and other factors, more and more investors are beginning to look for safe haven investments like cryptocurrency and gold. As the global economic situation remains uncertain and uncertain, this could lead to increased demand for crypto and increased prices.
Retail investors are able to earn interest
Institutional investors aren’t the only ones showing interest in cryptocurrency. Retail investors, or individual investors are also beginning to invest in the market for crypto. With increasing numbers of everyday people learn about crypto and the best ways to invest in it this could result in increased demand and higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market is maturing increasing numbers of people are beginning to become aware about and appreciate the concept. As awareness and acceptance of cryptocurrency grows, it will lead to more people purchasing and holding crypto, which could increase prices.
world crypto began with friendly
Financial decentralization (DeFi) is a rapidly growing area of the crypto market, which allows finance services developed upon blockchain technology. As DeFi continues to grow and more platforms and projects come online, this could result in increased use and more expensive prices for crypto.
Developments in crypto payment methods
As the crypto market grows as more and more businesses are beginning using crypto to be a method of payment. This could lead to an increase in the usage of crypto in daily transactions and an increase in the cost of transactions.
Increased investment from sovereign wealth funds
The sovereign wealth fund, also known as state-owned investment vehicles, are starting to look at crypto as a potential asset class. As more funds allocate a portion or their entire portfolios to cryptocurrency, it could increase demand and more expensive prices.
Use of crypto for international payments
One of the main advantages of cryptocurrency is its ability to make fast and cheap cross-border payments. As more individuals and businesses are beginning to make use of crypto for international transactions, it could result in increased demand and higher prices.
An increasing number of crypto ATM’s
The number of ATMs that accept crypto increase, it will become easier for people to buy and store cryptocurrency, which can drive up demand and prices.
Development of security tokens
Security tokens, which are digital assets that are used to represent ownership of an asset, such as stocks or real estate is a fast-growing area of the crypto market. With the increasing number of security tokens being issued and traded, this could lead to increased demand and consequently higher costs for cryptocurrency.
More adoption by merchants
With the increasing number of retailers begin accepting crypto as a form of payment, this makes it easier for people to hold and use crypto, which could drive up demand and prices.
So, will crypto grow in 2023? It’s only time to find out. But with these factors to consider, it’s possible that the cryptocurrency market will be able to see a rebound in 2023. And for those who are committed to the long-term Being patient and disciplined is essential.