CRYPTO MELTDOWN: Bitcoin Loses Over Half Its Value This Year

Bitcoin has been undergoing a massive sell off. Here's all the information you need to know.
Share on social

Not just the economy has taken a hit this year, the cryptocurrency bitcoin has lost 52 percent of its value and is now around $21,000 per coin, says Coindesk.

The cryptocurrency has lost 70 percent of its value overall since its high of $69,000 last November.

The crypto market overall is taking a bath, too. The entire marketplace has fallen to $1 trillion in market capitalization compared to last year when it was worth $3 trillion.

On Tuesday, trading platform Binance, one of the biggest crypto trading platforms, paused bitcoin withdrawals citing “a stuck transaction causing a backlog.” Many investors didn’t buy the official line, though.

However, Crypto investors think that the prices will fall even more and many have labeled the selloff as signs of an upcoming “crypto winter,” meaning that prices will fall and stay low for a long time.

The coin market has been mirroring the stock market as of late. This week the S&P 500 Index fell into a bear market, which is defined as a drop of 20 percent or more. Bonds are also falling. Investors have little place to reinvest their money currently in Biden’s economy.

However to investors with longer timelines, it’s a great time to enter the crypto market and use dollar cost averaging investing to reinvest into the crypto, say financial experts.

“You have to be more vigilant because it’s more volatile,” certified financial planner Ivory Johnson, founder of Delancey Wealth Management in Washington, D.C. said.

What’s causing this crash? The Federal Reserve announced that it’s tightening interest rates to slow down inflation and that’s one of the reasons that asset prices are falling. Access to take out loans is getting more expensive, meaning that the available money supply will slow down and hopefully stall inflation.

Douglas Boneparth, CFP and president of Bone Fide Wealth in New York says, “You might see this as a great opportunity.”

Buying the dip in bitcoin right now is a good deal if you have a long term conviction about the coin, say experts. Right now, it’s a great deal – if you believe it will go back up.

Tom Hanks’ Health In Question After He’s Seen With Shaking Right Hand

“I don’t think the rules really change here; if you’re a believer in bitcoin, then you might see this as a great opportunity,” Boneparth.

“Young venture investments have wonderful upside, but they come with a lot a volatility,” said Tyrone Ross, CEO of Onramp Invest, about Bitcoin. “They can die off of environmental changes.”

If you are buying bitcoin right now, “it’d better be paired with long-term conviction,” Ross said.

Bitcoin also allows investors to do tax-loss harvesting because there is no wash rule like there is with stocks. This means that investors can sell their crypto at a loss to harvest the losses and offset their taxes.

“Those are prudent things that advisors should be doing with their clients, and we should be expressing to the average investor to take advantage of some of this ridiculous volatility,” said Ross.

When there is blood on Wall Street, it’s a great time to buy – according to the old adage. That’s what we are seeing now. A massive sell off because people’s money is getting tighter and we’ll start to see a huge slow down in spending across the country. Crypto, like any other asset, is seeing this trend. Will you be investing in more crypto now that it is cheaper or not?

CRYPTO MELTDOWN: Bitcoin Loses Over Half Its Value This Year

Joel Bailey

Joel Bailey is a social commentator and writer at the Next News Network. He graduated from Fisher College in Boston, Massachusetts and was adopted from Africa. He is proof of the American dream and learned conservative values at a young age.
Stay Updated

Get us in your inbox

By subscribing you agree to our Privacy Policy

New & Trending
Latest Videos
Follow us