The cryptocurrency market has been witnessing widespread turbulence since Wednesday’s May 19 and the plunge has sent all cryptos into the deep blue sea, and this has made investors nervous.
The crash has triggered heavy selling in the cryptocurrency market as investors look to offload their holdings and minimize losses amid the ongoing uncertainty. At the same time, some people have expressed a desire to “buy the dip”, hoping for a rebound in the near future.
Experts think if bitcoin breaks through the current support and falls below $30k, we might experience even more dip. And while bitcoin is known to thrive while fiat fails, this past week, despite a fall in the US equity market and an increase in inflation, bitcoin still dipped.
Most analysts have said that it is not a good time to invest in cryptocurrencies, considering the high volatility that has battered valuations at the moment. However, some analysts think it may not be a bad idea to buy the dip.
Last Thursday, Twitter and Square CEO and a great believer in bitcoin, Jack Dorsey, announced that Square, Inc. is creating a new business that will focus on bitcoin. While too much information was given, Jack mentioned that the sole goal of the new business would be “making it easy to create non-custodial, permissionless, and decentralized financial services”. We love to see it!
Should You Buy The Dip?
It depends totally on whether you are ready to take the risk. In case you are looking for a safe, long-term investment option, cryptocurrency may not be your preferred choice of investment, given the high volatility and risk factor.
But if you have an appetite for risk and have the financial backing to invest in cryptocurrencies, it could be right up your alley. The returns will be much higher than traditional investments if you stay on top of daily trends, but you should also be ready for frequent bouts of extreme volatility.