It’s no secret that the crypto world has been experiencing a rough ride for the past year. Many cryptocurrencies have declined in value. However, many experts believe that bitcoin will reach new monthly highs by mid-2023, and many investors who missed the boat in 2018 are getting ready to buy some bitcoins while it’s still trading low. Will bitcoin bounce back in 2023? Let’s look at how likely the flagship cryptocurrency will return to its previous support level of around $20,000 by mid-2023.
Recent Uptrend in The Crypto Markets
A look at Bitcoin’s price over the last week shows that its value has increased slightly, which is a positive sign for investors. This comes after the value of the coin took an initial dip having peaked back in November. Since then, the price of Bitcoin has remained essentially unchanged until now.
The flagship cryptocurrency started the year off at $16,320 and is currently hovering around $17,300. Its 3% increase this week has boosted other cryptocurrencies, such as Ethereum and Cardano, to surge in performance after months of low-price activity. This positive price movement has boosted many DeFi projects, leading analysts and industry players to believe that this upward trend will continue into mid- 2023.
Why Cryptocurrencies Lost Value in 2022
In 2022, cryptocurrency investors suffered two major crashes. The first crash was the LUNA Crash, which occurred in June 2022. When the relationship between Luna Coin (LUNA) and TerraUSD (UST), an algorithmic stablecoin, was not as secure as previously thought. This led to more than $60 billion being wiped out of the digital currency space. The second crash occurred in November 2022 when FTX suffered an even worse fate than Luna. Former FTX CEO Sam Bankman Fried filed for bankruptcy after admitting that he used a large portion of investors’ funds and his funds to pay off debts incurred by FTX under its parent company, Alameda research.
The crypto market has yet to recover from the losses caused by these major events. The bear market that followed saw the value of all major cryptocurrencies fall by more than 50%. This means that many investors holding onto their coins lost a significant amount of money, while some others were completely wiped out. The market has been consolidating ever since.
Should Investors be Hopeful for a Bitcoin Rebound?
While Bitcoin has reached new highs before, investors should note that the path ahead is still a rocky one. However, there are several factors that will help propel Bitcoin to new heights in the future. For instance, increased adoption news: Morgan Stanley’s recent report found that many companies are looking to incorporate blockchain technology into their products and services. This includes significant tech firms like IBM, Amazon, Twitter, and Facebook. Many traditional retailers have also started accepting cryptocurrencies as payment for online goods and services. These include Overstock.com, Expedia Inc., and CheapAir. Also, positive economic news and cooling inflation levels can help propel Bitcoin to new monthly highs in 2023.
Conclusion
Although many investors are weary after bitcoin’s performance in 2022, it is worth remembering that the flagship cryptocurrency recovered after its decline in 2018. Considering this and bitcoin’s bounce back in other years, there is a good chance that the cryptocurrency will report higher levels in 2023. We expect to see at least 40% gains by 2023, as long as there isn’t another major crash in the crypto market.
