Bitcoin’s fall from record highs can be a crypto investor’s lesson to learn
Bitcoin is hovering over a drastic drop of around $59,000. This is one week after the cryptocurrency reached an all-time high of $67,000. Although the fall from the new high is alarming the traders, its current price is still a huge leap from its low of $40,000 in September.
While Bitcoin’s down surge had the investors doubting, other investors had already exchanged the world’s most valuable crypto for the new player in town – Shiba Inu.
On Wednesday, Bitcoin was trading at around $59,000 on more than a 5% drop. However, its value was already 12% below last week. If it were an asset like a stock, that huge drop would already call for a market correction.
Coinbase is #1 in the app store right now — ahead of TikTok, YouTube, Instagram, Snapchat, and Facebook.
You may want to start paying attention.
— Joe Pompliano (@JoePompliano) October 28, 2021
But since it is Bitcoin, it’s just business. Traders are quite used to its volatility. Before this current drop, there were sudden surges already. It’s attributed to China’s central bank banning any cryptocurrency transaction and mining. This followed a declaration that all cryptocurrencies are illegal in the country. While Bitcoin tops at $52,000 in September, it has dropped again and strived to get back at more than $50,000 until October.
Though Bitcoin investors shouldn’t overlook that most of the time, its value is on the rise. After a drastic surge under $30,000 in July. That being said, crypto remains the leading cryptocurrency.
While more than 13,000 cryptocurrencies are at play, Bitcoin is still on top with its market value of $1.1 trillion. It’s almost half of the size of the whole cryptocurrency market, which has a value of $2.47 trillion.
In addition, the second placer Ethereum is worth $475 billion. At the same time, other cryptocurrencies have lesser value than Ether and Bitcoin.
Price drop effect
No major changes in the cryptocurrency were predicted anytime soon due to the onset of bitcoin exchange-traded funds. While the ProShares Bitcoin Strategy ETF started trading last week, the launch of Valkyrie Bitcoin Strategy ETF followed after.
Financial advisors and cryptocurrency experts advise against dropping much of the portfolio due to its volatility. Nate Nieri, a CFP with Modern Money Management in San Diego, California, said, “You have a high chance of losing it all, but a small chance of winning it big. Don’t gamble an amount that would burden your family or prevent you from achieving your goals if you lost it all.”
Although there are some positive predictions from other Crypto experts, hopes are still up. As they say that prices could probably hit $100,000 before the year ends or early 2022. Moreover, it’s not a secret that business magnates such as George Soros and Paul Tudor Jones have been buying Bitcoin.
While other Bitcoin miners and traders are sulking over the drop, others are predicting even higher targets. As capitalist Tim Draper said, the crypto could top $250,000 by the end of next year. However, an asset value can’t soar up this high indefinitely.
Many factors affecting the crypto giant’s prices are inevitable, and it may be that the huge swing in prices is just the beginning.
