News JVTech Bitcoin: is the recovery planned for 2023?
Published on 08/01/2023 at 16:20
After a colorful year for cryptocurrencies, many investors are waiting for a sign from the Bitcoin king. Surprisingly calm at the start of the year, will Bitcoin manage to visit new highs by the end of 2023?
Bitcoin in the spotlight in 2023
Since January 2022, Bitcoin has seen its price drop by 62% over an entire year punctuated by unfortunate events such as the collapse of several giants in the sector such as Terra, 3AC or more recently FTX. However, it is clear that the situation is not new, like the collapse of QuadrigaCX in 2013, considered one of the biggest crypto exchanges at the time.
Although the sector has evolved, as usual the first cryptocurrency seems to stick to its famous cycles of volatility, regardless of the capitalization of the giants of the sector.
Well known to all, we speak of a bull run when the price of the cryptocurrency soars upwards and of a bear market when it tends downwards in the long term. This Bitcoin price movement usually takes the rest of the cryptocurrency up or down.
In total, since its creation, bitcoin has generally experienced four bull runs:
2011 – from $1 to $31 2013 – $100 to $1000 2017 – $100 to $19,000 2020 – $3,200 to $68,000
Through this latest bull run, the cryptocurrency sector seems to have conquered a new beginner audience, as evidenced by the numerous appearances of influential crypto players in multiple fields such as sport.
The capital gains of some early investors may have held the promise of good things for newcomers to crypto. However, once the speculative peak is reached, several freshly initiated investors find themselves at a loss since they bought Bitcoin at a higher price than today.
As a result, a majority of Bitcoin holders, and other cryptos of all kinds, are waiting for a saving element from the king of cryptocurrencies in the hope of one day seeing a potential Bull run again.
Bitcoin, in “bull run” for 2023?
After a year full of twists and turns, many hope that 2023 will be less lackluster for cryptos. When some media or institutions predict yet another “death” of bitcoin and cryptos, other pseudo “crypto experts” claim that it will be “250,000” during the year. Surprise, no one is able to indicate who is wrong except Marty McFly…
Among all its clear-cut predictions, it is therefore difficult to form an opinion on the situation, especially since Bitcoin is not independent.
Indeed, cryptocurrency is extremely correlated with various external factors and in particular with the financial health of the large companies of this world. While a major portion of publicly traded stocks saw their price drop during 2022, Bitcoin seems to have followed the decline. From Netflix to Tesla, several companies recorded more or less similar losses to Bitcoin in 2022, following the COVID health crisis.
In addition to the overall economic state, to hope to see a bull run in 2023, the crypto sector must also get out of a crisis of confidence vis-à-vis users. The collapse of the second platform FTX has caused crypto holders to lose billions of euros, leaving serious consequences for the market. The remaining platforms, such as Binance, act as collateral victims in the face of widespread panic and record exceptional withdrawals. This back-to-square-one situation is forcing these companies to regain user trust.
As for the hopes of seeing a Bitcoin rebound to new highs, arguments also exist. Beyond the fundamental technological aspects of Bitcoin that continue to convince newcomers over the years, many hope to see the halving of 2024 be a game-changer. This event of halving miner rewards every four years has proven effective in triggering past bull runs, but will it be again this time around?