As you all know, the world is currently going through a financial crisis. One of the reasons for this is because of the war occurring in Ukraine. It has had massive effects on transporting materials across Europe, as well as causing an energy crisis. Due to this, the cost of living has increased in the United Kingdom and other countries.
The financial crisis has affected several things but something that many did not expect the impact on the crypto market. The crypto market suffered its largest decline in years during November. Bitcoin, Ethereum, and Litecoin have all dropped dramatically in the last few years. Furthermore, the collapse of the FTX market also affected the crypto market, making the value of crypto coins lower than expected.
The question is, will it return to its peak value or has the future of cryptocurrencies finally come to an end? In this article, we will look at why cryptocurrencies may return and when.
This Has All Happened Before
Believe it or not, this has happened before. We are not talking about the financial crisis, energy crisis or the war in Ukraine. We are talking about the crypto market crashing. In April 2021, Bitcoin reached its highest value ever, valued at $63,500. Almost two months later, the coin dropped to $41,000 due to trends on Twitter and people making statements on the digital currency. Nonetheless, it did not take long for the coin to recover and in fact, recovered most of its value by the end of the year.
In the early years of Bitcoin, its value dropped massively. In 2013, Bitcoin was valued at $1,160 and dropped massively for well over a year. By the time January 2015 came around, the coin was only valued at $150. However, by the time 2017 came around, the coin peaked at $19,600. This was a long wait for Bitcoin to recover its original value however, it did manage to exceed its highest value by a long way.
Back in December 2020, the value of Bitcoin reached its highest point of all time, breaking the $50,000 value and exceeding $68,000 in November 2021. It is something that nobody ever expected, especially those who invested in the crypto market back in 2013. However, since that high back in 2021, the market has fluctuated for many reasons. One of those includes Tesla’s investment in cryptocurrency as well as other billion-dollar companies around the world. Additionally, there have been many companies that mentioned they were staying clear of cryptocurrency. It harmed the value of Bitcoin and again, caused it to fluctuate.
Something that Bitcoin has never experienced is what is going on in the world right now. There hasn’t been an energy crisis since Bitcoin started to gain value, there hasn’t been a war which affected the rest of the world and there haven’t been so many investors since Bitcoin began. All of these factors play a pivotal role in the value of Bitcoin and if money is tight for some people, they will sell their assets. Nonetheless, the recovery of Bitcoin in previous years shines a bit of light on the crypto market and provides us with the hope that the value will increase again after everything else has recovered.
A Long Bull Run Has Always Followed The Bear Market Of Bitcoin
You will be pleased to know that this is very true. There has always been a large bull run not long after the coin has dropped significantly in value. The crypto market is very volatile and if it is on trend, many people will follow. On the other hand, if many people sell their Bitcoin assets, many other people will follow as they do not want to lose too much money. It is understandable why this is the case.
These bull runs are very different to bull runs in the stock market. The bull run in the crypto market will take Bitcoin to new highs that people could never imagine. All of a sudden, the world is talking about cryptocurrency again and therefore, more people invest in the coin. It isn’t just the average citizen that invests in cryptocurrency either. It also includes billion-dollar companies around the world who acknowledge that crypto is here to stay. The higher Bitcoin increases in value, the more companies and people invest in the cryptocurrency market.
The Growth Of Blockchain and Crypto
There are a lot more projects and more people accept cryptocurrency than ever before. Still, there is a lot of doubt surrounding the crypto market but it is still in demand by many businesses around the world. For example, the gaming industry is reducing the need for debit and credit card payments because of cryptocurrency. In some games, players can earn crypto as an award if they are competing competitively.
The banking industry has been affected massively by the crypto market. One of the main reasons for this is that companies are now accepting cryptocurrency instead of cash, debit or credit card payments. As soon as Apple announced they will be acknowledging payments of cryptocurrency, it has become a massive problem for banks around the world.
Will Crypto Return In 2023?
We cannot promise that the value of Bitcoin and other cryptocurrencies will return in 2023. It could be another low for the crypto market for the next couple of years. Not to mention that it also depends on other factors in the world such as the war and the energy crisis. Nonetheless, if we look in the history books, the value of crypto has always returned to its value as well as surpassed its all-time high. Although we cannot guarantee it will return to its value, we have enough confidence that it will, especially with more companies investing in it.
Something to be a way of with the crypto market is that you must invest in the most popular cryptocurrencies. That includes Bitcoin, Ethereum, Litecoin and any other cryptocurrencies which are well-recognised. Furthermore, there are a lot of cryptocurrencies out there which are not legitimate. Thousands of people are falling for crypto scams around the world at the moment. That is why you are better investing in those well-recognised in the crypto market already.