Cryptocurrency

Massive drop in Bitcoin, Dogecoin, Ethereum and other coin prices. What it means for investors?

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bitcoin
  • Prices of popular cryptocurrencies like Bitcoin, Etherium, and DogeCoin have dropped massively in the last 24 hours.

Prices of popular cryptocurrencies like Bitcoin, Etherium, and DogeCoin have dropped massively within the last 24 hours. At around 6.30 pm today (May 19, 2021), Bitcoin was trading at just Rs 28.5 lakh while Etherium was trading at Rs 1.8 lakh on cryptocurrency platforms. DogeCoin price has fallen to Rs 21 while Shiba Inu coin, which was within the news recently, had dropped by over – 48 percent to Rs 0.000710.

Prices of just about all coins are within the red and dropping. The drop in prices of those popular coins could seem dramatic but considering the high volatility of crypto assets, it shouldn’t come as a surprise.

News agency Reuters reported that Bitcoin fell to a 3-1/2 month low on Wednesday after China banned financial payment institutions from providing cryptocurrency services.

According to Avinash Shekhar, Co-CEO of ZebPay, an almost 40 percent dip within the bitcoin price from its all-time high looks dramatic but is normal in many volatile markets, including crypto, especially after such an outsized rally.

Shekhar said such corrections are mainly thanks to short-term traders taking profits. He said that for the long-term value investors, the falling prices might function a buying opportunity.

“A nearly 40 percent dip within the bitcoin price from its all-time high looks dramatic but is normal in many volatile markets, including crypto, especially after such an outsized rally. Such corrections are mainly thanks to short-term traders taking profits. Long-term value investors might call these lower prices a buying opportunity, as MicroStrategy just did,” Shekhar said.

“Technical analysts would call this a test of the price around $40,000. Neither sort of investor would say that tweets are the underlying cause. Investors should invest in education first. Research the underlying value of Bitcoin, Ethereum, and other crypto-assets as you would possibly check out a company’s information before buying stocks. Use strategies like rupee cost averaging and SIPs to more confidently maneuver through volatility and take a long-term view,” he added.

The price of Bitcoin has been ever since Tesla’s payment U-turns. Bitcoin had an honest rally and experts think it had been due for a correction.

Should you invest in Bitcoin?

The future of cryptocurrencies is unpredictable and therefore the present volatile. it’s a really high-risk asset. Hence, experts suggest that one shouldn’t risk important savings and emergency funds in cryptocurrencies.

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