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Bitcoin’s 21% fall in past 2 days can change investors attitude: Experts

By Saima Siddiqui 
Updated Date
Bitcoin’s 21% fall in past 2 days can change investors attitude: Experts

Lucknow: After Bitcoin witnessed a sharp decline of 21% in past two days, UK’s Financial Conduct Authority (FCA) on Monday issued an advisory stating investments in cryptocurrencies such as bitcoins come with “very high risks.” Furthermore, if consumers invest in these types of products, FCA said, they should be prepared to lose all their money.

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This wild volatility in the Bitcoin market was recorded first time since March 2020. Keeping that in consideration, as per experts, investors should give second thoughts on whether to invest in Bitcoins or not.

According to a market expert, Bitcoin’s price shoot up from $18,000 to over $40,000 within a month. That’s over 100% price hike in such a short span of time.

“Bitcoin’s price dropping from $40,000 is a healthy correction and it will help to build a more solid foundation for price appreciation,” the expert said.

However, he further added, while the market is recovering, investors should take caution as Bitcoin is testing its top levels. As of now, it’s a high risk, high return investment option and only time will tell how stable Bitcoin’s current price levels are in terms of price support.

Also Read :- Bitcoins may soon become illegal in India, sell your cryptocurrency now!

Meanwhile, another trade expert believes bitcoin is still a nascent technology and it’s biggest use case is fast and free transfer of value and for this to happen, it is important that bitcoin finds out its own value through speculations. However, it could just fail for whatever technical reason.

“Its value is extremely volatile and it may wash away the entire investment and there is no obligation for anyone to protect one’s investment or buy his/her bitcoin. Also, India has a history of restricting or banning new technologies before their legitimate usage becomes fully evident in other developed countries. So in other words, there could be a time where the bitcoin holdings cannot be liquidated”, warned the trade expert.

Whereas, founder of CoinSwitch Kuber, feels that it may still make sense for long-term investors to hold on to bitcoins. In his opinion, “While there may have been drops in the market but the prices have shown an upward trend in the 6-month and 3-month window. So, bitcoins should always be looked at from a long-term perspective.”

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