Crypto Volatility Does Not Necessarily Mean a Ruthless Thing
What comes to your mind whenever you hear someone mention cryptocurrency volatility? Well, as long as you do not rely on the “Musk” effect when investing in virtual coins, crypto volatility will not necessarily mean an evil thing.
This statement follows Bitcoin, the leading digital coin by market cap, regaining some value after declining drastically. You probably understand that some BTC investors have sleepless nights given the current market conditions. However, do you have to worry? Well, maybe because it is your investment.
Bitcoin has had a rough journey in the past few months. On Wednesday, the virtual coin dropped by around 30% before regaining a bit.
Different factors affect the current bitcoin market. For instance, China warning against the role of digital coins in the economy sent BTC tumbling over the last week. The China remark prompted Elon Musk to tweet that Tesla will continue to hold its BTC. Keep in mind that the car company invested $1.5 billion on bitcoin early in 2021. Most crypto enthusiasts speculated on Tesla selling its BTC holdings after the firm suspended transactions involving the virtual coin.
As a crypto investor, you need not worry about the ‘crypto crash,’ creating an uproar in the market. Volatility in online trading is similar to the turbulences witnessed in other markets.
As you could do with any other business, the best tool to use for now to alleviate risks and use volatility to your advantage is diversifying your investments.
As a crypto enthusiast, you can expand your investments on other markets such as Ethereum, the second-leading digital asset. Savvy investors know how to use high volatility as an opportunity to buy. However, that will need some expertise to enjoy returns.
Moreover, you should be cautious in a case where one prominent individual drives volatility in the crypto space.
Volatility might be a powerful investment technique if used efficiently and effectively.
The best thing is to control your emotions when playing with market volatility. Do not let Elon Musk drive your investment decisions. Keep in mind a single influential executive can influence dramatic fluctuations in all directions.
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