when will crypto recover

Cryptocurrency markets have been in a bear market since 2018, and the bear market has reached a new low in 2020. The magnitude of the bear market has put pressure on traditional investors, cryptocurrency investors, institutional investors and governments alike. Cryptocurrency markets have absorbed a significant amount of investment capital, and the lack of institutional activity has caused a downward price pressure on the top cryptos.

The question of when the cryptocurrency markets will recover, is one that many people are asking right now. Unfortunately, there is no definitive answer as to when the recovery will come, though there are a few possible scenarios that could see the market begin to recover. The first scenario is the adoption of cryptocurrency by institutional investors. Institutional investors are the most powerful actors in the global financial systems and their entrance into the crypto space could spur a significant price surge. If institutional investors enter the crypto space, they may bring with them the traditional financial instruments such as futures contracts, derivatives, index funds and such, which are more complicated than the existing trading infrastructure.

The second scenario for crypto recovery is the onset of a new bull market. Previously, cryptocurrency markets often saw spikes in prices and activity around each new coin lauch. This bull market phenomenon has been largely absent in the last few years, but if the introduction of institutional investors is accompanied by a swell of FOMO (fear of missing out) then the markets could rapidly recover.

The third scenario for a crypto recovery is the emergence of stablecoins. Stablecoins attempt to address the issues of volatility and price manipulation by tying the value of a cryptocurrency to a dollar, or another asset. Stablecoins offer the crypto space a way to transact with certainty, as the value of the cryptocurrency will remain mostly steady. This would attract a new wave of investors, who were hesitant to make investments in a highly volatile market.

Finally, the fourth scenario for crypto recovery is the introduction of new regulations and oversight. The cryptocurrency markets were born out of the concept of decentralization, but recently governments and financial institutions have begun to pay attention. Institutions like the Commodity Futures Trading Commission and the Securities and Exchange Commission have introduced regulations that may reduce the amount of trading manipulation, while also providing a certain level of protection for investors. If these regulations are implemented, there could be a significant shift in the markets, which could in turn spur a recovery.

No one knows for sure when the crypto recovery will come, but it could be dependent on a combination of institutional investment, a new bull market, the emergence of stablecoins and the implementation of sound regulatory framework. It is possible that some of the aforementioned scenarios could lead to a recovery of the cryptocurrency markets in the near future.