2022 was an intense year for every cryptocurrency, including Bitcoin. Cryptocurrency flagship Bitcoin lost about 65% of this total market value, and cryptocurrency investors were unprepared for several unpredictable events like the FTX fall, Terra Luna crash, and macroeconomic conditions. However, Bitcoin shows a strong momentum of rising at the beginning of the year 2023. However, cryptocurrency enthusiasts can’t help but wonder if Bitcoin will rise again in the coming months and if now is a good time to invest in it.
Bitcoins rise in the first half of 2023
After a disastrous 2022, Bitcoin began to rise. Several factors could have caused this. One of which is the inflation in the United States and United Kingdom which has to fall and could fall throughout 2023. This means that interest rates could fall. This resulted in investors’ confidence in the stock and crypto market.
Could Bitcoin’s price recover to its peak?
Currently, BTC to USD stands at $27,496. This price shows an improvement from its $17,000 price in December 2022. However, this price is still far from its peak valuation which was above $60,000 in 2021. However, what resulted in this huge decline?
Several factors resulted in this steep decline. The severe economic conditions of 2022 stand at the forefront of the fall. To fight inflation and supply shortages, the United States Federal Reserve added several interest rate hikes.
However, the Ukrainian/Russian war added increased uncertainty. As a response to this, many investors reduced discretionary spending and didn’t want to spend on volatile or risky assets. Additionally, the shocking fall of the FTX crypto exchange further added to the decline, as investors lost almost US$1 billion. With such precedents, many became wary of investing in Bitcoin.
Is it a good idea to invest in Bitcoin?
Bitcoin is a high-risk investment that is also very volatile. For Investors willing to take on the risk, it is vital you know what you are investing in. Some key things to note include having a cryptocurrency investment strategy, considering taking financial advice from experts, and only investing that which you can afford to lose. Apart from the above, you can also consider asking yourself certain questions before getting started, they include:
● How well do I know what I intend to invest in and how does the cryptocurrency and Bitcoin
market work?
● Am I financially prepared to potentially lose my investments?
Like every type of investment, if you want to purchase Bitcoin, ensure you don’t invest the money that you need. When you intend to invest in cryptocurrency or any other investment type, always seek financial advice from experts and invest what you can afford to lose.
Endnote
Cryptocurrency analysts and experts hold mixed predictions on Bitcoin. However, it is worth noting that Bitcoin has experienced several downfalls and has remained stronger each time. Bitcoin’s resilient nature remains a belief for cryptocurrency enthusiasts who find value in decentralized currency investments. Whether Bitcoin continues to fall or rises is something that will depend on time. Also trading Bitcoin and other cryptocurrencies must be done with the knowledge that the investment might not provide the anticipated returns.
