Top 3 reasons that suggest that Bitcoin has the potential to be big in 2023

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Disclaimer: The opinion expressed here is provided for informational purposes only, and is not investment advice. There is risk involved while investing so, you should always do your research before making any decision. Sociobits’ opinions are not necessarily being reflected here and we don’t recommend investing money that you cannot afford to lose.

The year 2022 has been a year of turmoil and defeat for cryptocurrency investors. It is true that there were more losses than wins this year with the crypto winter crashing into investors’ lives. The bearish trend of the crypto market could be attributed to a lot of reasons like the rise in interest rates, credit becoming harder to avail due to the end of monetary easing, etc.

Even the biggest and the most accessible asset class of the crypto market, Bitcoin was affected by this. Bitcoins witnessed around 67% decline this year. While the bigger question remains whether the crypto market will bounce back anytime soon, many analysts and surveys suggest that the year 2023 could be the year for Bitcoin! Here are the three reasons why experts think Bitcoin has the potential to surge in the year 2023.

1. Institutional Investors are Encouraging Bitcoin

The financial giant Fidelity Management surveyed 1,052 institutional money managers from North America, Asia, and Europe. According to the annual Fidelity Digital Assets survey, in the first half of 2022, 58% of institutional investors who were surveyed bought Bitcoin and 74% of them have planned to invest in crypto somewhere down the future. This suggests that institutional investors are choosing to invest in Bitcoin as they start to view cryptocurrencies as an acceptable asset class.

More examples that display the interest of big investors is increasing in crypto could be the Bank of New York Mellon, the oldest bank in the U.S announced it would begin to offer custodial services for Bitcoin because of high client demand. The world’s largest asset manager, BlackRock also announced that it will work with Coinbase to offer its trading platform Aladdin for clients who also held Bitcoin on Coinbase.

Since these investors have more purchasing power as compared to retail investors, this could be one of the reasons why the price of Bitcoin could be driven up.

2. Blue Chip Companies are also validating Bitcoin

Not only institutional investors but also Blue Chip companies are starting to accept cryptocurrencies as a legitimate mode of payment, especially Bitcoin. You can witness a number of tech and financial giants that have started to use Bitcoin. The list of major companies that accept crypto includes Microsoft, PizzaHut, Starbucks, etc. PayPal was one of the first companies that started accepting Bitcoin as payment around 2020.

Also Read:  This is what happens to investors' money when a crypto company goes bankrupt

Recently, Google’s parent company Alphabet has also announced that it will be allowing its customers to pay for Google Cloud using Bitcoin and some other cryptos. On the other hand, Mastercard has also announced that it plans to work with the crypto firm Paxos to enable traditional banks to offer cryptocurrency investing and trading services on their platforms.

3. The Ease of Interest Rate by the Federal Reserve

In order to fight rising inflation, the Federal Reserve increased interest rates from 0.25% to 0.5% to 3.75% to 4%. This aggressive increase in the interest rates led to the crash of many assets like tech stocks, Bitcoin, etc. According to the number of market observers, the Federal Reserve is bound to decrease these rates in the future, and doing so, will allow investors to feel more comfortable investing back in assets like Bitcoin.

These are some of the reasons that suggest Bitcoin may be able to see the sun in the coming year. Although 2021 and 2022 have been highly disappointing for Bitcoin investors, for an asset class that is fairly in the speculative stage, its value has held up better than expected. Looking at the marketing conditions that Bitcoin has survived, 2023 could be at least better than the ongoing year.

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