How Low Can Bitcoin Go this Winter?

The law of the investment game is that what rises must fall. Investors need to be aware of the possibility of a market decline or worse, which requires careful timing.

Bitcoin and other cryptocurrencies are no different; in fact, they’re even better examples of the adage since they’re more volatile than equities. With Crypto Winter 2021 in full swing, there’s some worrying talk this morning.

Cryptocurrency’s Danger When addressing the long-term viability of these assets, the term “Black Tuesday” is commonly thrown about. Could such a market collapse be on the horizon?

There are several things in play right now that bears will cite to support their case for affirmative action.

Cryptocurrency has been on a tear this fall:

• The price of Bitcoin (BTC) has risen to record highs.
• It has been a great year for meme coins like Shiba Inu (SHIB) and Floki Inu (FLOKI).
• The Ethereum (ETH) and Cardano (ADA) networks have been upgraded.

However, it’s important to keep in mind that this strong autumn comes after a dreadful summer for the market.

In early 2021, interest in non-fungible tokens (NFTs), a kind of digital currency, dwindled from 73 cents to less than 20 cents.

The stock market fluctuates at a dizzying pace. To stay up, one must be many steps ahead of the game.

As speculation about a possible crypto market correction nears its zenith, investors’ eyes are drawn to it.

Investors aren’t simply scratching their heads as they normally would after this morning’s market drops. The real question is whether or not they should alter their current investment approach.

Also See: 30+ NFT/Crypto Terminologies You Must Never Forget

Cryptocurrency investors are calling for a market meltdown before the end of 2021, and this is not a new digital currency convention.

Although the next winter months aren’t mentioned, it’s possible that what we saw this summer with the decline in crypto values is also equivalent to a crypto winter.

To put things in perspective, many triggers all worked together to push the market down in the early summer months.

The Chinese government has taken a harsh stance against cryptocurrency miners.

Despite being the world’s most important source of crypto mining, the disaster had a severe impact on Bitcoin mining.

Many of these miners were forced to abandon their businesses or find other locations in neighboring Asian countries with less restrictive blockchain regulations.

Elon Musk, on the other hand, contributed to lower prices by accepting Bitcoin as a payment mechanism for Tesla (TSLA) and then soon dumping it.

To express his discontent with Bitcoin mining and other proof-of-work cryptos, Musk resorted to Twitter.

As a result of the pessimistic tweets, a new breed of digital currency investors has emerged.

To a large extent, these variables were responsible for the market slump that dragged down the crypto asset class until late August when NFTs and recovering Bitcoin prices served to buoy the sector and make it ready for its current bull run, which began in late September.

Also See: Cryptocurrency Hacks: How Much Did They Steal?

Things have been going well for a long time, but they will eventually come to an end. In addition, bitcoin adoption is suffering a setback on a worldwide scale.

In China, Bitcoin and other cryptocurrencies are being slammed as “very hazardous.” The Chinese government and the National Development and Reform Commission are working together to impose punitive sanctions on organizations discovered to be mining cryptocurrencies.

The Kazakh government looks to be getting a little sick of Chinese miners as well, despite Kazakhstan being a popular destination for those who have evaded the country’s rules. After having its crypto mining hash rate more than double at the start of the summer, the Central Asian country is now experiencing power constraints.

Kazakhstan is now restricting the amount of electricity that miners may consume.

The situation in the United States isn’t much better. As part of Joe Biden’s infrastructure package, which includes new laws on the reporting of cryptocurrency profits and other blockchain assets like NFTs, the bill has been signed into law.

Because they limit the intrinsic financial freedoms of the digital currency business, these regulations are particularly unfavorable to crypto investors. A 16-month high in the dollar shows just how much the economy has recovered since the new coronavirus outbreak broke out.

When the crypto business is in a slump, investors are looking to move their money out of it and into more conventional investment venues, which affects the market indirectly.

BTC lost $30,000 this summer, causing the rest of the cryptocurrency market to follow suit. Of course, if things went wrong, this was a possibility. Things won’t be as awful as they seem, however, if previous BTC success versus pessimistic views is any indication.

The first Bitcoin futures ETF went online on Wall Street last month, and experts anticipated that Bitcoin would lose as much as 50% following the debut. It was only shortly below $60,000 before the coin recovered these losses.

Source: https://sammaiyaki.medium.com/how-low-can-bitcoin-go-this-winter-7b20b32c1a42?source=rss——cryptocurrency-5