Merely seven months ago, the world’s most popular cryptocurrency was as high as $69,000. Today, Bitcoin has dropped as low as $26,000. With the current inflation in the global economy, recession, the Fed’s monetary policies, and the tension between Russia and Ukraine, Bitcoin’s value may plummet even lower.
It is no longer news that investing in crypto is a potentially lucrative opportunity. Until recently, investing in cryptocurrency was a major store of value that was considered a worthy means of protecting assets. However, the recent dip has changed the tide for the crypto market, and many are wary of fixing hard-earned money in something prone to constant fluctuations.
Is this the best time to buy the bitcoin dip?
The answer to this will be based on your risk appetite as an investor. Bitcoin, like most cryptocurrencies, is a highly volatile and speculative investment. However, Bitcoin has sold as high as $69,000 in November 2021. For many investors who come from its $10,000 price in July 2020, this remarkable high is a worthy feat. In addition, the last week alone showed Bitcoin rising to over 8%, trading above $32,000 by the end of May.
These constant, almost yearly changes mean that investing in a volatile market like crypto may not be the best choice if you are looking for quick money. However, if, as an investor, you believe in long-term and holding on for a foreseeable rise in an asset, then now may be the best time to buy into the Bitcoin dip. To invest in a market like crypto, be sure to be prepared for the risk that comes with it and the unforeseeable changes that the market has.
Popular opinion says if your risk appetite is aggressive, there is no better time to buy Bitcoin than when it is in a dip. However, emotions or market changes should not determine how you make your investment choices. Instead, understanding the market and knowing why you are investing matters in the larger scheme of things. Always ensure that you have covered every financial area like your retirement plan before putting money in a volatile asset like Bitcoin.
The future of cryptocurrencies like Bitcoin is bound to be controlled by market fluctuations in years to come. That is why experts advise keeping crypto investments as 5% or less of your total portfolio. Judging from its history, Bitcoin has experienced downturns and high levels, making it a highly volatile market. Subsequently, a price change in Bitcoin, whether high or low, should not influence your decision to make a trade on Bitcoin.
In conclusion, with the Bitcoin sell-off intensifying, buying into the dip may seem the most probable at this point. However, before making any decision, it is important to understand the crypto market and know that Bitcoin as a cryptocurrency pays off more often in the long run. The time of making money quickly through Bitcoin sales is long gone.