The last couple of weeks have proved tough for the cryptocurrency market. Bitcoin (along with other major digital currencies) has plunged in its value, thereby leading to intense speculations about the future of cryptocurrency among investors. Market skeptics warn cryptocurrency investors to prepare for the worst even as there is no concrete evidence suggesting that digital coins won’t make a comeback in the near future.
The decline in the cryptocurrency world is led by the fall in Bitcoin value, estimated to plunge below 30% in the last fortnight. There are many reasons behind this decline. The news of China banning financial institutions and banks from providing cryptocurrency services to their clients has become instrumental in fueling the latest decline in Bitcoin value. The measures announced by the Chinese government are part of its strategy to discourage investors from dealing in digital coins. Given the large market size of China, it is indeed a setback for the entire domain of cryptocurrency, including Bitcoin.
The recent tweet from the owner of Tesla, Elon Musk, has also caused panic among investors as the company decided not to accept payments for its electric cars in Bitcoin. It came as a surprise because not very long ago, Elon Musk sounded upbeat about Bitcoin and announced that prospective buyers could pay in Bitcoin to purchase Tesla cars. This about-turn took many by surprise and further dented the prospects of Bitcoin.
To make matters worse, the two largest cryptocurrency exchanges in the world, i.e., Binance and Coinbase, suffered outages on Wednesday, thereby causing the highest decline in the value of Bitcoin since March 2013. Although these kinds of service outages are not uncommon in the cryptocurrency world, these are enough to raise concern among investors about their investment in the crypto sphere. Cryptocurrency exchanges must learn lessons from history and understand that these glitches could have a long-term impact on the investors’ sentiments and investment potential in the crypto world.
It is indeed a turbulent time for the investors, and especially considering the ongoing uncertainty, Bitcoin Forecast is not a child’s play. Many crypto experts and specialists believe that fundamental parameters related to Bitcoin and other cryptocurrencies continue to remain strong through short-term unpredictability that will persist for some time. No doubt, there have been some developments that could potentially impact the fortunes of digital coins, but there’s hardly any doubt about the long-term sustainability of digital currencies.
Staying put with the investment at this point seems to be an optimum strategy for investors. Keep a close tab on the ongoing developments, and only after considering the holistic scenario should one take a final decision about their investment. Remember, any decision taken in panic (irrespective of the nature of the decision, i.e., whether to invest or exit) could adversely impact the investment’s return potential. Hence, it’s best to track the crypto market and its principal parameters before arriving at any concrete conclusion related to investment strategy.