Why Is Bitcoin Falling – Important Facts To Know
The cryptocurrency market has been shaky lately, and the most popular digital currency of them all, Bitcoin, is no exception. In fact, the price of one bitcoin has fallen from $56,995 at the beginning of December 2021 to $20,846 at the time of writing this article. This means that even though the digital currency rose above $20,000 in mid-December 2017 (the first time it reached $20k), it has since lost a lot of value within this time frame. Is it time to panic?
So, Why is Bitcoin Falling?
There are a few reasons that the price of Bitcoin may be falling.
- One reason is that the Coronavirus pandemic has led to a decrease in global economic activity, which in turn, has led to a decrease in the demand for Bitcoin, as people are selling off their assets to cover their expenses.
- Another reason is the halving event, which occurred recently. This may have led to miners selling off their Bitcoin to cover their costs.
- Finally, there is always the possibility of whales (large investors) manipulating the market by selling large amounts of Bitcoin at once.
What Can You Do About It?
If you’re worried about the falling price of Bitcoin, there are a few things you can do.
- You can hold onto your Bitcoin and wait for the price to rebound.
- You can invest in other coins like Litecoin or Ethereum.
- You could convert your Bitcoin into USD or other fiat currency by using exchanges like Coinbase (signing up with this link gives both of us some commission from Coinbase) and then buy back into BTC when the price drops again.
- If this does not seem like a viable option for whatever reason, then sell some of your Bitcoins to avoid further losses.
Another option would be to just keep trading with more experienced traders who might know what they’re doing better than you!
The Good News
Despite all the doom and gloom, there’s still reason to be optimistic about Bitcoin. Here are three reasons why you shouldn’t panic.
- First of all, when prices go down this means that it’s a good time to buy more Bitcoin. A lot of people have been doing this and by buying now, they’re locking in some lower prices for later.
- Second, despite recent setbacks with new regulations in countries like China, these issues are expected to pass eventually (or at least not affect BTC too much). With new money coming into the system from emerging markets (in crypto) like Brazil and Mexico, it’s hard to imagine that these issues will linger forever.
- Finally, as adoption continues with projects like Square opening up payment services for businesses that don’t accept cryptocurrency yet (like Uber), we should see more stability in price over time–and probably even an eventual increase in value.
The Bad News
Bitcoin has been on a bit of a roller coaster ride lately. After hitting an all-time high in 2021, the cryptocurrency has lost more than half its value (as of the time of writing this article). So, what’s behind this sudden drop?
Bitcoin prices have taken a tumble as South Korea announced that it may ban exchanges that trade cryptocurrencies. Investors are concerned about tighter regulations in other countries like China or Russia as well, which would make trading even more difficult than it already is.
Additionally, experts attribute the recent price increase to be from traders who are trying to buy the dip following rumors of stricter regulations overseas. Bitcoin has always had lots of ups and downs; however, it can be hard for those not versed in trading stocks or currency markets to keep up with these volatile shifts.
How To Prepare
If you’re thinking about investing in Bitcoin, or have already done so, it’s important to stay up-to-date on what’s happening in the market. After all, the value of your investment can go up or down, and you don’t want to be caught off guard. Here are a few ways to prepare for the possibility of a falling Bitcoin market.
Diversify Your Investments
Make sure that you diversify your investments with other currencies (i.e., USD, EUR). Open an account with a more traditional bank. There may come a time when online banks would stop accepting deposits from cryptocurrency exchanges due to increased scrutiny from regulators and law enforcement agencies. By opening an account at a traditional bank, you’ll still be able to cash out of Bitcoin if necessary whenever you see negative signs.
Use An Insurance
Buy insurance against cyber attacks by purchasing cyber protection services like those offered by BitGo. While no protection service can offer 100% security against these types of attacks, there are services that offer varying degrees of coverage that will help protect your investments even if they get hacked as often as once every day on average! These services also typically provide tools for users to store their Bitcoins offline and keep them safe from harm. Take advantage of these features today to ensure that your Bitcoin isn’t lost forever should a cyber attack occur.
Will Bitcoin Rise Again?
Bitcoin has been on a roller coaster ride over the past few months, and it doesn’t seem to be slowing down. To answer the question of whether Bitcoin will rise again or not, we will need to understand why it’s actually falling in the first place.
- First, there’s been a lot of negative press surrounding Bitcoin recently.
- Second, there’s been some uncertainty about the future of Bitcoin regulation.
- And third, there’s been a general decrease in demand for Bitcoin.
What Does This Mean For You?
If you’re holding onto Bitcoin, you may want to sell now while you can still get a good price for it. And if you’re thinking about buying Bitcoin, you may want to wait until the dust settles and the price stabilizes.
No one knows for sure what will happen with Bitcoin in the future. But if you’re looking for an investment that isn’t as volatile as Bitcoin, consider a broad-based index fund like the Vanguard 500 Index Fund.
Final Thoughts
If you’re like most people, you’re probably wondering why Bitcoin is falling. The answer, unfortunately, isn’t simple. There are a variety of factors that contribute to the price of Bitcoin, and it can be difficult to predict what will happen next. However, there are some things you can do to protect your investment. First, don’t panic.
The price of Bitcoin has been volatile in the past, and it will likely rebound at some point. Second, diversify your portfolio. Don’t put all your eggs in one basket, and consider investing in other cryptocurrencies as well as traditional assets like stocks and bonds. Finally, stay informed. Keep up with the latest news and developments in the cryptocurrency space so you can make informed decisions about when to buy or sell.
About The Author
Williams Alfred Onen
Williams Alfred Onen is a degree-holding computer science software engineer with a passion for technology and extensive knowledge in the tech field. With a history of providing innovative solutions to complex tech problems, Williams stays ahead of the curve by continuously seeking new knowledge and skills. He shares his insights on technology through his blog and is dedicated to helping others bring their tech visions to life.
