January Proves to be a Challenging Month For Bitcoin


BitcoinMarketsEconomy

Track live crypto price of 10000+ coins!


Bitcoin has benefited greatly from increased attention and adoption in 2021. It hit multiple all-time highs throughout 2021 before simmering down in December. But the start of the new year hasn’t seen the strong demand of years prior – at least when it comes to current market value.

The Bitcoin price closed in the green on 11 days in January. They represented a small reprieve in a sea of red for the month of January. In fact, bitcoin has lost close to 50% of its value since its all-time high of $69,000 in November.

However, this volatility isn’t anything new for seasoned bitcoin holders. The cryptocurrency has seen its share of drop-offs in the past. While recovery time has ranged from a few months to over a year, bitcoin has showcased its resilience numerous times.

“I’ve always said if you’re uncomfortable waking up to a 30%, 40%, even 50% decline for whatever reason, you probably shouldn’t own it [bitcoin],” said Troy Gayeski, chief market strategist at FS Investments.

But most experts agree that the drawback isn’t due to flaws with bitcoin itself. Rather, it mirrors the current market sentiment and uneasiness as inflation continues to rise. The US Federal Reserve has been slowly decreasing its quantitative easing and has suggested it will continue to do so over the course of the year.

Related:  How Bitcoin Pizza Day Resembles Festivus

The market responded to the news by marking several significant declines. This was undoubtedly felt within the bitcoin market as many investors consider it and other digital assets as simple investment products rather than full-fledged currencies. This has led to lower volumes all around as retail and institutional investors look to manage their risk exposure.

The positive upside

While the overall market has decreased, some have taken it as a sign to add to their bitcoin holdings. Companies such as MicroStrategy continue to purchase millions of dollars worth of bitcoin. Other companies have doubled down and invested heavily in their mining infrastructure.

While the current downtrend may have spooked newer investors, veteran bitcoin holders aren’t selling off. In fact, the low price seems to be a buying signal for many. Compared to prior years, bitcoin has seen wider adoption and more support than ever before. With El Salvador accepting the cryptocurrency as a legal tender, and other countries discussing similar legislation, the bitcoin market may see an ever-increasing floor price.

author avatar image

CJ is a copywriter by trade, specializing in technology and the decentralized world. He’s a staunch supporter of financial freedom, self improvement, and living to one’s highest potential. He currently runs Techtonic Copywriting while also acting as a marketing advisor for several startups and companies.


Download MAXBIT Android App, Your best source of all crypto news!

Google Play

Source link