It’s been a tough ride for the crypto market in 2022. In November, the market had dipped by 70% from its previous peak in November 2021. When things were going downhill, 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 cryptocurrency market, specifically Bitcoin, has seen its fair share of dips over the years. Every time, it’s bounced back with a huge increase.
For example, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for over a year, reaching a low of $150. However, in 2017 it broke that record and hit a record record high of $19,600. Then, in 2018, it was trading at $3,100. In 2020, it broke through that resistance, and reached a record high of $68,000 in November 2021. Just like that, we’ve seen another dip. But history shows us that after each dip the bull runs.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed before, fall-offs are usually followed by a prolonged bull run that eventually surpasses the resistance created by the previous high 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 adopting the technology, its use and acceptance is rising. From finance to gaming the use of crypto is increasing in a variety of ways. The growing popularity of crypto can lead to more people being involved in the crypto market and, in turn, increase the price.
A rise in the interest of institutions for crypto
In recent times we’ve witnessed a rising curiosity from institutions investing in cryptocurrency. From banks to hedge funds numerous large institutions are beginning to investigate the possibilities of crypto assets. The increasing interest from institutions could bring more stability to the market for crypto and result in higher prices.
Regulations of the government
As the crypto market grows as it matures, governments all over the world are beginning to establish more favorable regulations for cryptocurrency. This could help attract more investors and boost the acceptance of crypto in general.
A broader range of blockchain applications
The underlying technology behind many cryptocurrencies, blockchain, offers a variety of possible applications beyond just financial transactions. From supply chain management to voting systems, more industries are beginning to look at ways they can make use of blockchain technology. This will drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Crypto and blockchain technology are at the very beginning of development. As advancements continue to be made in areas like security and scalability, the potential of cryptocurrency assets will continue to grow. This could result in more use and increase in prices.
Rising global economic uncertainty
Due to the constant economic uncertainty caused due to the COVID-19 pandemic, as well as other causes, more and more investors are beginning to look for safe haven assets such as gold and crypto. As the global economic situation is uncertain it could result in increased demand for crypto and more expensive prices.
Interest from retail investors
Institutional investors aren’t the only people who are interested in cryptocurrency. Retail investors, or individual investors are also beginning to get involved in the market for crypto. With increasing numbers of people learn about cryptocurrency and investing in it This could result in more demand and higher prices.
The growing awareness and acceptance of cryptocurrency
As the market for crypto continues to mature increasing numbers of people are beginning to become aware about and appreciate the concept. As understanding and acceptance grows of crypto, this could lead to more people buying as well as holding the crypto that could increase prices.
world of waves crypto
Decentralized finance (DeFi) is an area that is rapidly expanding in the crypto market that allows financial services to be created upon blockchain technology. As DeFi expands and more projects and platforms become available, this could lead to increased adoption and increased prices for crypto.
Developments in crypto payment methods
As the crypto market is growing increasing numbers of companies are starting using crypto to be a method of payment. This could result in increased use of crypto in regular transactions and higher prices.
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 of these funds dedicate a part or their entire portfolios to cryptocurrency, this could lead to increased demand and more expensive prices.
Use of crypto for cross-border payments
One of the biggest benefits of cryptocurrency is its ability to make quick and inexpensive cross-border payments. As more individuals and businesses begin to use cryptocurrency for international transactions, it could result in increased the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
The number of ATMs that accept crypto continue to grow it will be easier for people to buy and hold cryptocurrency, which can increase demand and price.
The development of security tokens
Security tokens, also known as digital assets that are used to represent ownership in an asset like stock or real estate is a fast-growing area of the crypto market. As more security tokens are created and traded, this could lead to increased demand and consequently higher rates for the crypto.
More adoption by merchants
With the increasing number of retailers begin accepting crypto as a form of payment, it will make it easier for people to use and hold crypto, which could increase demand and price.
So, will crypto grow in 2023? The only way to know is time. However, with these aspects in mind, it’s possible that the cryptocurrency market will see a recovery in 2023. For those in it for the long haul Being patient and disciplined will be key.