No matter the potential for this asset class, involvement in cryptocurrencies is never easy. Case in point are the ever-volatile bitcoin prices. Just a little over a month ago, the virtual currency complex was making tremendous headway. For bitcoin, it appeared that breaching the $10,000 level was just the beginning.
But with a series of selling pressures, bitcoin dropped from its approach toward the $14,000 mark. Now, bitcoin prices are having trouble maintaining the key psychological five-digit threshold. As I write this, each unit of the original blockchain-based token is trading hands at just over $9,500. Indeed, it’s been a difficult past few days for most major virtual currencies.
Yet I wouldn’t fret about the wildness in bitcoin prices. Even if you bought in near recent highs, there’s really no need for panic. Here are three things to consider while we go through this turbulence:
Bitcoin Prices Confirm Robust and Comprehensive Demand
Let’s get the obvious out of the way: no one likes to see losses in their portfolio, even ones that are merely “paper losses.” That said, the willingness for market participants to execute trades on both sides of the aisle provides serious confidence.
Here’s the thing: it’s always worrisome when all players pick one side of the trade. Historically, we saw this with tulip mania. Everyone bet on the same horse, which initially spiked prices of tulip bulbs to meteoric levels.
However, when the fundamentals could not support such a valuation, everyone switched to the bearish end. The result? A complete evaporation of this market.
Trust me, even if you’re taking some losses, you want the bitcoin market to be viable. This fierce negotiation between bulls and bears represents exactly that.
Believers Get a Discount
This is another obvious point, but it’s worth repeating: if you really believe in the long-term potential of cryptocurrencies, the fallout in bitcoin prices shouldn’t depress you. Indeed, they’re on opportunity to get this and other cryptos at discount prices.
Emotionally of course, losses are always a drag. You want to see the markets move in your favor. Genuinely, I believe that time will come, and probably before you even know it. But to take advantage of this opportunity, you must get over yourself in a way.
Looking back, I think we’ll view bitcoin prices at under $10,000 as a once-in-a-lifetime chance to load up on a paradigm-shattering investment. But you know this already because you believe in this asset class as much as I do!
Cryptos Are Transformative Investments
During this turmoil in bitcoin prices, let’s not forget about the most important consideration: the fundamentals. What separates high-value investments from unsustainable bubbles is their fundamental catalyst.
With bitcoin and the blockchain complex, it comes down to their transformative nature. Prior to this innovation, it was impossible to create a competing currency and commerce platform to established fiat-based channels. Now, the cryptocurrency concept has proven that millions, if not billions of people are willing to disconnect from central banking.
And that’s really why the mainstream establishment is so terrified. Cryptos provide real financial freedom from the usury of fiat. That’s why I sleep easy at night. All this mamby-pamby BS in the markets merely detract from the overall bullish picture.