ZURICH / LONDON (IT BOLTWISE) – Bitcoin price has seen a dramatic decline in recent weeks, sparking concern among investors. From a high of over $125,000 in early October, the value has fallen to around $84,000. Experts warn of further fluctuations and discuss the advantages and disadvantages of Bitcoin as an investment option.
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The Bitcoin market has experienced significant turmoil in recent weeks, causing concern among many investors. The price of the leading cryptocurrency has fallen to around $84,000 from a high of over $125,000 in early October. This development has reignited the discussion about the suitability of Bitcoin as an investment option for private investors.
A key factor behind recent price movements is uncertainty in global financial markets. Nervousness, particularly in the area of artificial intelligence, has led to a decline in stock markets, which is also affecting cryptocurrencies. Despite the announcement of record profits by NVIDIA, a leading manufacturer of computer chips for AI applications, markets reacted negatively, further increasing Bitcoin’s volatility.
Another reason for the price decline is the outflows in spot Bitcoin ETFs. These investment products that track the Bitcoin price have recently lost popularity as institutional investors remove risk from their portfolios. This has led to increased selling pressure on Bitcoin, causing the price to fall further.
The uncertainties surrounding decentralized finance (De-Fi) are also contributing to investor reluctance. Recent hacks, like the one at Yearn Finance, have weakened trust in cryptoassets. There are also concerns about the liquidity of companies like Strategy that hold large amounts of Bitcoin.
However, in the long term, some experts still see potential in Bitcoin. Despite the current volatility, Bitcoin is often viewed as digital gold that could benefit from doubts about traditional fiat currencies. The high national debt and the expansive monetary policy of the central banks could further fuel interest in cryptocurrencies.
For private investors, the question remains whether Bitcoin makes sense as an addition to the portfolio. Some financial experts recommend including cryptocurrencies such as Bitcoin and Ethereum in portfolios with a share of up to 5 percent. Others, however, see cryptocurrencies more as speculative investments that are best suited as “play money”.
The future price development of Bitcoin will largely depend on macroeconomic factors, in particular on the US Federal Reserve’s decisions on interest rate policy. As long as there is no clarity here, the Bitcoin price remains vulnerable to fluctuations.
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