The first question on everyone’s mind these days is “Has Crypto bottomed out?” After all, the price of Bitcoin is at an all-time high. But what is the next step for crypto investors? What are their future opportunities? And what are the risks? And has the market peaked already? Here are some thoughts to consider. And, as always, please don’t be a bear.
For investors, the answer is “no” and “maybe.” Despite the bear market that has gripped the crypto market, some indicators point to a bottoming out. The number of VC funds in crypto is rising, indicating that a bear market is nearing its end. One way to determine if the crypto industry has bottomed out is to look at how much dry powder is available on exchanges.
While cryptocurrency prices have been moving in tandem with stocks for the past few months, they have been falling in parallel with the stock market. In fact, the NASDAQ and S&P 500 just had their worst week since March 2020. This could be attributed to investors selling-risk assets, such as technology stocks. Further, investors are evaluating the impact of further regulation, such as Russia’s central bank’s recent proposals banning mining and using of cryptocurrency.
As the price of cryptocurrency moves in tandem with the prices of stocks, it’s important to keep in mind that the cryptocurrency market has a short-term history of bear markets. Its past price swings were mainly caused by the actions of traders and retail investors. As a result, investors are cautious, and should wait for the funds to dip below their previous levels before buying discounted assets. But this doesn’t mean that investors should stay away from crypto entirely.
As the market is in a bear market, it is crucial to keep an eye on the prices of Bitcoin, Ethereum, and the other major cryptocurrencies. Even though the price of bitcoin has fallen below $44,000 in the last week, Ether has only gone down 14 percent in the last seven days. Meanwhile, the Shiba Inu coin has declined by 78 per cent, and Cardano is up more than 2 percent today.
In the short term, it is crucial to avoid investing more than 5% of your portfolio in crypto. The reason is simple: it can hinder your other financial goals. If you’re not careful, you’ll risk missing out on the upside. So, if you’re looking to invest in crypto, wait until the fund prices have dropped to your preferred level before grabbing discounted assets. But, there’s still a downside: you may end up losing money if you’re too bullish.
For investors, this means that prices have bottomed out, and they’ll be forced to sell. But, before you make any decisions, it’s essential to understand the fundamentals behind cryptocurrency. If you don’t understand the market, don’t be afraid to invest a little bit in it. In fact, the more money you put into cryptocurrency, the more you’ll stand to gain. If you’ve been holding back, then it might be time to buy.
If you’re concerned about the market’s future, keep an eye on the VC fundraising in crypto. This indicates a bottoming out of the market, and it can also signal a bullish breakout. But it’s important to remember that VCs don’t invest in crypto until after the market is overvalued. So, wait for it to drop a little more before you grab a discounted asset.
If you’re worried about a crypto crash, wait for a few days. After all, the VC funding for the cryptocurrency market has been increasing for the past few months. The VC money is a signal that the market has bottomed. This is a good time to buy if you’ve been able to invest in cryptocurrency in the past, but you’ll need to wait for the IPO in the meanwhile.
A V rally is not common for a currency market, so the first time it does, you can bet on a huge rally. However, it will be difficult to gauge whether it will be a bottom because it’s too early to tell. If you’re not confident enough to bet on it, keep your money in other currencies. They’re more likely to go down in the long run than crypto.