Bitcoin made a comeback last year after a very low price slump and this year also Bitcoin is getting lower and lower. With a few tries to get up there again, it is not getting a comeback like the last year it did make after its lowest.
The Experts still getting their hopes high for Bitcoin and others to retain their highs once again but right now it is not getting even close to it.
People are advocating against investing in digital currency in the crypto market but still advise to take a little to see before investing in it.
In the fall of last year, Bitcoin rose sharply: within a year, the value had risen by an incredible 400 percent. A digital coin of the most popular cryptocurrency costs almost $65,000 at its all-time high – only to crash to a good $35,000 within two months. Now that the price has recovered a bit, should one strike in the hope of another lavish price increase? Or should you rather keep your hands off the cryptocurrency?
Opinions differ about the background to the recent crash and the slump in prices that has persisted since mid-January. Philipp Sandner, the crypto expert at the Frankfurt School of Finance & Management, blames the stricter regulation in Russia and China, as well as the central banks: “The general mood on the capital markets has clouded over due to the forthcoming interest rate increases,” says the professor.
Bitcoin Is Still A Valuable Asset
But there could also be other reasons for the slump in prices. In the fall, many investors, especially on social media, had conjured up a price jump to $100,000. As is well known, this has not been fulfilled. And data from analytics site Coinglass shows that since then, numerous bets on rising prices have collapsed, tending to push the price of bitcoin down.
“Bitcoin is a very speculative investment,” emphasizes Thomas Mai, financial expert at the Bremen consumer advice center. From his point of view, the fact that the Bitcoin price has multiplied since it started in 2009 does not mean that it will necessarily continue like this. It is still a young form of investment, reliable future forecasts cannot be derived from the price development in the past.
In the case of the classic stock exchange, on the other hand, where you can look back on much longer periods of time, the case is clear, says Mai: After every setback, things go uphill again. “It can take five years or eight, but the upward trend is always there.”
Also read About: What is Bitcoin?
Speculation About Bitcoin
Opinions are divided as to whether Bitcoin will soon be on the up again. Analysts at Swiss UBS recently warned of a “crypto winter”, a prolonged phase of low prices. According to them, central banks’ ongoing fight against rising inflation rates will permanently depress the price of cryptocurrencies, while investors are increasingly put off by the high volatility of prices.
Some other analysts, on the other hand, are optimists who consider permanently low prices to be rather unlikely. After all, more and more companies worldwide are opening up Bitcoin for their customers, and the savings banks are currently toying with the idea. According to them, more and more crypto-savvy university graduates are entering the job market. These fundamental observations tend to lead to the conclusion that no crypto winter is imminent.
What The Future Holds
However, according to the latest reports from the specialist magazine “Finance Forward” (FFWD), those plans by the savings banks are causing considerable spat.
And so it is ultimately unclear whether Bitcoin will continue to spread and whether higher demand will soon bring it a substantial price increase again – especially since the criticism is also getting louder from other quarters: Unlike competing for digital currencies, the public’s favored coins until now relies on a technology that consumes a lot of electricity. Some experts assume that renewable energies will increasingly be used for this. On Friday, however, several environmental politicians in the EU Parliament called for a complete ban on the use of bitcoin price with hokk finance in the EU.
This makes the situation all foggier for the Bitcoin advocating analysts but judging from the last year’s crypto market slump, we can still keep our hopes intact and hold our coins tightly in our wallets to see again the better days after this market crisis in the world of cyber currency.