Is Buying BTC After its Drop the Right Move?

Now that BTC suffers a sharp drop, is now the right time to buy?

BTC is still vulnerable to price swings

Bitcoin formerly rose to a new all-time high of around $64,000 per unit in April. But the world’s number one cryptocurrency has seen a series of drops. BTC took it down to the low of $30,000 at one point. Having a loss of over half its value from two months ago.

Now it seems like Bitcoin may be starting to rise again. Because it jumped by about $5,000 in the last few days from $32,000 to $37,000 as of now. Because of this, many people believe that the currency could be trying its luck at another bull run. And they are speculating if they should buy before it gets expensive.

Binger says that one of the biggest concerns with Bitcoin is its alleged lack of security. He says that the space is unregulated, which is why he cannot always ignore his clients being involved in crypto.

“I understand that crypto is a global currency. It is unregulated. I understand that some may be concerned about U.S. inflation and a weakening dollar, but I still think that gold is a better hedge if those are your concerns… Crypto is just way too volatile, way too speculative for our client base. I really think the crypto market is more for retail traders who are trading on price momentum both up and down and a handful of corporations that are willing to take a swing at it.”

Michael Binger, president of Gradient Investments

Are Speculative Assets Ruined?

Sanchez gives a similar sentiment, and she goes as far as to say that bitcoin is hurting all speculative assets in a way:

“We are still sellers of bitcoin. The broader market and the economy, quite frankly, are showing a lot of money shifting back and forth into the economy through consumption and through investment, and it is hurting all speculative assets… Bitcoin lands solidly in that space as a speculative asset, but we are also seeing SPACs and IPOs all get hit all at the same time, and we see this as just a sign that money is moving away from speculation back into the real economy.”

Gina Sanchez, CEO of Chantico Global

While Bitcoin witnessed its price boom in 2020, this was also a sign that its volatility did not improve over the past few years. With the currency jumping from $4,000 to nearly $30,000 by the end of the year. Since then, the asset exploded in price and tripled its end-of-2020 mark, reaching over $60,000 a few months later.

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