Bitcoin (BTC) continues hard-pressed, with the world’s most prominent token sliding 6.1% through the past 24 hours.
Is Bitcoin melting? 1 Bitcoin is currently around US$44,858. The decline has seen Bitcoin’s market cap plunged from more than US$1.1 trillion in mid-April to US$845 billion today, as per data from CoinDesk.
Let’s keep this in viewpoint, though.
While BTC is currently below 31% from its ATH of US$64,829 on 14 April, it’s still higher by 59% in 2021. If you got Bitcoin at this same time last year, you’d be still be sitting on a gain of 363%.
But let’s leave that behind us now. The question investors are considering today is – What’s next?
Should we still get Bitcoin in our portfolio?
Once the price of an asset slips more than 30% for a couple of weeks, investors are inclined to hit the sell button. Panic selling crypto assets may not be in investors’ best interests.
Anthony Scaramucci, the founder of SkyBridge Capital, remains bullish on his outlook for Bitcoin. Hint: You may also remember Scaramucci from his 10-day role as former US President Donald Trump’s communications director.
According to Scaramucci (quoted by Bloomberg):
As an investment adviser and someone who’s been running money for 30-plus years, it’s responsible for me to tell my clients to own 1%, 2%, or 3% [in Bitcoin]… I’m not telling them you’ve got to own 100% of your net worth in it – but if we’re right, you don’t want to be missing out on this.
Scaramucci stated that notwithstanding the growth in altcoins, Bitcoin has sustained “its supremacy as the apex predator in digital currency.”
Joining Scaramucci’s bullish standpoint is Twitter Inc. and Square Inc. CEO, Jack Dorsey. He tweeted that:
“Bitcoin changes *everything*… for the better. And we will forever work to make bitcoin better.”
Square’s CFO, Amrita Ahuja, had earlier tweeted:
Our bitcoin strategy hasn’t changed. We’re deeply committed to this community, including working towards a greener future through our Bitcoin Clean Energy Initiative. And as we shared in February, we continue to assess our bitcoin investment on an ongoing basis. Nothing new here.
Buy-the-dip predictions for sold off cryptos
Instead of expecting a longer-term persisted slide for Bitcoin, Simon Peters, a crypto analyst at multi-asset investment platform eToro, believes crypto investors will possibly return in the next couple of weeks.
According to Peters:
Several factors are driving the sell-off; valuations were at or near all-time highs… so there will naturally be some profit-taking, while we are also seeing a general sell-off among risk assets – such as technology stocks – as economies start to unlock post the pandemic and investors fret over potential rate rises and higher inflation.
Yet, for several cryptocurrencies such as Bitcoin and Ethereum, the long-term story has not changed. This emerging asset class continues to revolutionize many aspects of financial services. While nothing climb in a beeline, the long-term fundamentals for cryptoassets remain as solid as ever.
Taking technical analysis aboard, Peters said, “Importantly, we continue to see higher lows, as well as higher highs, for cryptoassets as more investors enter this asset class, and we do not expect that trend to change.“
In share markets, a trend of higher highs and higher lows is considered a very bullish signal. Those same trends are also closely watched in the world of cryptocurrencies.
As far as the dropping Bitcoin price goes, Peters continues,
“We would expect to see buyers return to bitcoin, ethereum and peers in the next few weeks to take advantage of lower prices.”
If you are motivated to go bargain hunting among the beaten-down cryptos, remember their historically wicked volatility. If you can stomach that level of price swings, best of luck buying the dip!
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