It seems that Bitcoin prices are plunging back down. After the crisis, Bitcoin’s price is down now to approximately 50% from its heights. In the meantime, many people are wondering whether it is the best time to invest in Bitcoin. Here are certain things that you should consider before investing the money into cryptocurrency.
Many events have caused a rise in the value of Bitcoin recently to be impossible. The COVID-19 has paved a breathtaking fear upon global financial markets. Many actions are being taken for the protection against this disease including quarantine, business closure and the banning of schools and travels. Many investors are scared as these actions might cause the global economy to fall into recession. To sell the stocks and leading the world into a big loss.
Bitcoin is one of the few cryptocurrencies that stood well in worse times when the stock market has fallen. Many people consider Bitcoin as an asset that can be used in a time when its value increases can be sold and gain some big profits. But the current market scenario is very difficult and can be catastrophic. Cryptocurrency has always a hedge over other stocks as it can serve as a hedge against market turmoil. This is considered as the best use cases of Bitcoins.
Due to the global COVID-19 pandemic, to reduce the financial loss and recession many central banks around the globe have taken many drastic changes. One of them is to pump liquidity in the market. This will help to stimulate the economy and helps to maintain these drastic times. Due to this, the currency values of many countries have also gone down. But on the contrary, this is the kind of situation that Bitcoin is actually made for. Because the total supply of Bitcoin is very limited to about 21 million coins. So that in these tough times when all the stocks start to lose its value Bitcoins value will stay the same. This is what saves Bitcoins in times of inflation. But, this coronavirus has made some reduction in the value of Bitcoins.
Digital payments are not a new thing nowadays. It is what should be promoted during these tough times. Because viruses can stay alive in contact surfaces for many hours. To stop the spread of COVID-19 many banks have taken some measures to keep the money that is coming to the banks for about 14 days to kill the viruses that may be present in them. This started to promote digital payments rapidly in the country. This is what Bitcoins are, a peer-to-peer electronic cash system. But, yet it’s not the best time to invest in Bitcoin as it is not ready yet for mass adoption. It is still unsuitable as a payment network. As the need for digital payment increase does not mean the value of Bitcoin is going to increase anytime soon.
So, if you are planning to buy yourself a Bitcoin consider the usage before that. If you are considering it as a store of value for payments, then it’s not yet ready. But, the prices are gone down and considering the future higher prices, then it is a good investment. When the value of Bitcoin is high enough, you can sell your Bitcoin for high profits and earn some real money. But the Bitcoin price can still fall, so consider waiting for some more and do the right investment in the right time. But considering the future of digital payments and value of Bitcoins on the previous periods, this may be a best time to invest in one.