Bitcoin Price Crash: Should Investors Be Scared?

Smaller cryptocurrencies were worse hit since they had less value. However, the fall of these crypto networks gave way for the larger systems to thrive, with people looking to make profits. Hence, the rise of cryptocurrencies began again, eventually spreading onto the smaller cryptocurrencies.

As a crypto asset, Bitcoin is mainly volatile, and its value is dependent on the actions of investors and government policies. Similar to the less than impressive drop of Q4 2018, the current dip witnessed in Bitcoin stocks results from the activities of financial bulls and reluctant governments. While certain governments have moved to prohibit crypto transactions in their domain, there have also been complaints from disgruntled economic powerheads and crypto skeptics with a considerable following.

While it isn’t likely that there would be a recurrence of the 2018s run, where all cryptocurrencies, major coins especially, recorded gross devaluation and mass sell-off, investors should be somewhat cautious in throwing their resources into the crypto market till prices stabilize or there’s a likely bullish trend in the market once again.

Lately, while cryptocurrencies have witnessed increased mass adoption, there have also been increased negative reviews. With cynics and old-time investors alike reacting to the value of Bitcoin, the market would likely lose considerable traffic in the coming days, especially from high profile investors, hedge funds looking to recoup their capital before the market crashes, and miners hoarding assets.

Likewise, for some time, only the not-too-wealthy and not-too-privileged majority viewed cryptocurrencies as a break from the norm, traditional banking systems, and government policies that extorted its citizens and made the people lose trust in the banks. With the rise of Bitcoin and all that followed in its stead, there’s a more secure and trustworthy monetary system that allows users to choose what information to put out and what to retain.

However, in recent times, before the recent price surge, there have been more sightings and involvement of “whales” in the crypto power-heads, i.e. Bitcoin, Ethereum, et Al. While there are so many fears about the participation of whales, significant money investment is what causes the Bitcoin price surge. Whales are necessary for the Bitcoin market to thrive.

The fears of small investors aren’t invalid; they are significant and necessary. If the market would benefit small investors, caution has to be applied. While this trend currently threatens the investments of many, primarily late investors, it is a bit necessary to curtail the rise of the coin. If Bitcoin becomes too expensive, the likelihood of the coin becoming obsolete is excellent because it loses its primary goal of inclusivity.

Mining becomes more expensive, big investors solely run the market, and the contribution of small investors becomes very insignificant, forcing the more extensive market to find a more inclusive cryptocurrency asset. Bitcoin and its competitions are programmed to help investors rack in profits regardless of investment size; however, it doesn’t decide what move investors make. It’s up to you to choose “if you’d be the market’s pawn, or you’d pawn the market”.

Rather than call this “bearish”, Bitcoin’s current value decline should be seen as the first phase of a symbiotic tie. The prices fall so that the coin becomes more accessible to low-income earners, making profits off the eventual price increase. Like in every cryptocurrency, the present problem of Bitcoin is over-concentration.

Cryptocurrencies thrive on scarcity and increased demand; when there become too many Bitcoin owners, the principle of supply loses play as there then “looks” to be enough in circulation to satisfy the demands. The market loses its drive; there is no adventure or incentive to convince investors to float capital into the asset’s coffers.

However, the grand rule of investment is investing smart, without sentiments or individual preference. The market is controlled by the flow of capital, large sums of money, which most investors do not own. For most market watchmen, this recent dip reflects a new high, new investors, and fresh investments.

Bitcoin’s current predicament results from its volatility; its inability to maintain a set value makes it easy to manipulate significant investments. The lack of which devalues the coin. Recently, there have been talks of investing in more inclusive coins, the ETH, XRP, LTC, etc. However, as history has shown, the market never moves without Bitcoin; if smaller cryptocurrency assets find the audience, Bitcoin whales would be forced to make their contributions to halt the dip.

Should Investors Be Scared?

No! No! The current price drop in the market is just another feature of the market, volatility. The market would soon hit the balance between scarcity and demand; then, the Bitcoin value would most likely hit a new peak.

Just like in previous times, Bitcoin would rise once more. The financial market was designed to help the coin thrive, and that it would do.

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