When you look back at 2022, it was a tough year cryptocurrency. About $1.3 trillion was wiped off the value of the market. The world’s most popular digital coin, Bitcoin, has seen a more than 60% price slump. Whenever a person thinks of investing in the crypto market, the first thing that comes to mind is Bitcoin because of its reputation, and people believe that they can earn significant returns.
However, things could have gone better for Bitcoin in 2022. The recent implosion of FTX, an exchange that once wielded influence on the crypto industry, had an effect, and you may have heard about the crypto lender Voyager and TerraUSD collapse, which has become bankrupt.
Then, add in price losses in the stock market, hikes in the interest rate, and high inflation, all of this coming after Bitcoin and other cryptocurrencies have exploded in popularity.
But what will be the Bitcoin price in 2023? Will it keep dropping?
Let us find out below.
What affects Bitcoin price?
Bitcoin mining
Bitcoin protocols also allow for the creation of new Bitcoins. The miners process the blocks of the transaction, and when a new Bitcoin is added to the market, that will affect the supply. But you need to know that the number of Bitcoins is capped at 21 million, and once it reaches that, there will be no more production.
Demand and supply
The sum of the Bitcoin, which is traded on the exchange, represents the small percentage of the total supply that is in circulation. Most of the Bitcoin saving is not available for purchase. When the popularity increases, that will also raise the prices, and the currency’s low demand will lower its value.
Many corporations, investors, and people have started using Bitcoin as an online transaction, which has given Bitcoin widespread acceptance, increasing its prices in the future.
Rules and regulations
There has been a rapid increase in the popularity of Bitcoin and other currencies, which has defined digital assets. The security and exchange commission has classified cryptocurrency as a security, and they set the regulations or rules about cryptocurrency.
If the rules regarding the currency become too repressive then the prices will drop, and if it will be favorable to crypto then there will be more growth.
News
Everyone knows about media power, which has shown the most remarkable effects on Bitcoin prices. The general public has gained a greater understanding of cryptocurrencies and Bitcoin, and due to that, it has also gained the attention of the media.
Whenever investors find any new knowledge from the media, they tell their friends or family the same, and make a decision based on that. If there is positive news in the media, that will increase its price; otherwise, vice-versa.
Competition
When you check the crypto market, you will find that several well-known cryptocurrencies are accepted worldwide. There are several cryptocurrencies, such as Ethereum or Tether.
The price of Bitcoin depends on its market value too, and if the market value of other currencies increases, there will be a decrease in the price of crypto and vice versa.
Will the price of Bitcoin keep crashing in 2023?
In the early days only, there was chaos about the collapse of FTX, and there was an expectation that the Bitcoin price would fall to $10,000 for each coin. That has affected investment, and most people did not invest their money in it. In Mobius Statement (Mobius capital partner), he says that he will not invest his or his client’s money in Bitcoin.
Moreover, Matthew Sigel (VanEck digital assets head) is looking for a similar price target. They have predicted that the price of Bitcoin will fall between $10,000 and $12,000 for each coin. He believed that crypto miners are the reasons for this decline and higher electricity prices.
Bitcoin prices are still unpredictable
You must remember that cryptocurrency is the most volatile asset you can find. Prices swing widely, and not every predicting expert has the same views. That is why; it is said that the unpredictable nature of digital assets makes their prices stop falling.
Final words
If you ask whether the price of Bitcoin will fall, then that will be totally unpredictable because everyone has their theory. Moreover, that also depends on the factors which are going to happen in the future.
McClatchy newsroom and editorial staff were not involved in the creation of this content.
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