Cryptocurrencies on sale! It’s a good time to buy cryptocurrencies
Be greedy when others are scared. At the moment, the cryptocurrency is worth 51 percent less than the all-time high it hit six months ago at $67,800 last November. “It all depends on the point of view you see it”
With the price of bitcoin (BTC) falling, the big question is, “should I buy bitcoin now?” At the moment, the cryptocurrency is trading at $36,000. A figure that implies a 25% drop from the high it reached in 2022 at $48,000 and a 47% depreciation from its all-time high in November last year at $67,800.
Currently cryptocurrencies, like markets in general, are being hit by the unfavorable global economic context.
The price of bitcoin has behaved similarly to stocks since the start of Russia’s war against Ukraine. That, in turn, is that the United States and Europe are posting historic inflation records and China is deploying strong confinements on account of covid-19. A series of issues that shake up the world economy and therefore generate expectations on the price of BTC.
The price volatility that bitcoin has makes it function as a risky asset. Something that some investors prefer to avoid in times of economic uncertainty like the one we are experiencing now. This is due to the drops in value it can have in the short term. However, analysts believe that in the long term the cryptocurrency can dramatically increase its value due to the growing adoption it is having in the world.
Bitcoin’s price will increase dramatically in the long term if its adoption increases
“If the asset is good, time is its best friend in the long run,”
This is the thinking that governs large companies, such as Tesla and MicroStrategy, which have decided to store their reserves in bitcoin. Largely because they believe its value will increase over time.
Currently, the number of high net worth traders and bitcoin holders (investors who store the cryptocurrency for the long term) is on the rise. There are precisely more than 836,000 wallets with more than 1 BTC, according to data collected by Glassnode.
An all-time record that indicates that there are many players in the market with large investment who are confident that its price will continue to rise.
Without going any further, the growing number of companies offering services to invest in bitcoin shows how much the adoption of this asset has increased. Even traditional entities, such as exchange-listed investment funds and banks, have decided to enter the world of cryptocurrencies, which means that their clients are interested in investing in this market and have high demand for such services.
An example of this is LGT Bank in Europe and the attempt by Banco Galicia in Argentina to allow its customers to buy bitcoin. An initiative that indicates that traditional financial companies do not want to be left out of this wave that shows signs of continuing to grow. So have governments that have implemented regulations to levy taxes on cryptocurrencies.
Brian Estes, CEO of investment fund Off The Chain Capital, said, “As companies and banks get involved and become critical mass, the level of activity per user (in bitcoin) will really start to mirror traditional financial services. Considering this, he estimates that one BTC could be worth a million dollars by the year 2024.
Asset management firm ARK Investment Management projects the same number, but a bit later. According to its perspective, the price of bitcoin could surpass one million dollars by 2030. Following that line, for this same year, optimistic analysts believe it will reach $100,000.