The moment bulls and bears alternate, dreams of wealth turn to emptiness.
News swirls, enchanting the eye, as the wave of technological innovation surges.
Greed and fear disturb the heart, who can understand the unpredictable market.
2010: Bitcoin crashed, dropping to $10;
2011: The Bitcoin bubble burst, dropping again to $100;
2012: Bitcoin failed again, plummeting to $500;
2017: The Bitcoin scam ended, dropping to only $4,000;
On June 22, 2021, the century scam Bitcoin collapsed again, leaving only $28,800;
On October 19, 2024, the largest scam in human history, the Bitcoin crash, left only $68,000!
Whether there are still opportunities to invest in Bitcoin requires a comprehensive analysis of multiple factors:
1. Positive factors:
• Bitcoin spot ETF approved: The U.S. Securities and Exchange Commission approved the listing of the Bitcoin spot ETF on January 10, 2024, which helps increase the activity and liquidity of Bitcoin trading, improve the pricing system, lower the barriers for overseas qualified investors to participate in Bitcoin investment, and attract more investors and funds from the traditional financial sector, having a positive impact on the Bitcoin market.
• Bitcoin halving expectations: Bitcoin's mining rewards are halved approximately every four years, and in the six months following the first three halvings, Bitcoin's price has seen significant growth. The fourth halving occurred in April 2024, and based on historical experience, halving events may have a positive impact on Bitcoin prices, as a reduction in supply may push prices up under conditions of unchanged or increasing demand.
• Favorable macroeconomic environment: The monetary policy of the Federal Reserve and the global macroeconomic situation have a certain impact on Bitcoin prices. Some analysts believe that expectations of interest rate cuts by the Federal Reserve may lead to an increase in the supply of dollars and a depreciation of the dollar, while Bitcoin, due to its anti-inflation characteristics, may see increased demand.
• Technological innovation and ecological development: As the underlying technology of Bitcoin, blockchain technology continues to iteratively upgrade, providing a foundation for the large-scale application of Bitcoin. The mature application of second-layer solutions such as the Lightning Network has improved Bitcoin's transaction speed and throughput while reducing fees. Additionally, Bitcoin interacts with smart contract platforms to introduce innovative applications such as decentralized finance and non-fungible tokens, enriching the Bitcoin ecosystem and broadening its application scenarios.
• Increased market demand and acceptance: As public understanding and acceptance of digital currencies continue to rise, the application scenarios of Bitcoin in real life are becoming increasingly diverse. More and more payment giants support Bitcoin payments, some companies are incorporating Bitcoin into their balance sheets, and the investor structure is becoming increasingly diversified, all of which increase the demand for Bitcoin and the stability of the market.
2. Negative factors:
• High price volatility: Bitcoin prices have always been highly volatile, with dramatic rises and falls being almost the norm. This large price fluctuation puts investors at high risk; even if they may earn high returns in the short term, they may also suffer significant losses in a short period.
• Regulatory uncertainty: The regulatory attitudes and policies regarding cryptocurrencies in various countries are constantly evolving, and any new regulatory measures may significantly impact Bitcoin prices. For example, some countries may strengthen regulations on Bitcoin trading, restricting its use and trading within their borders, which would adversely affect Bitcoin's market development.
• Security risks: Bitcoin trading platforms and wallets still face risks such as hacking attacks and security vulnerabilities. Once a security incident occurs, investors' assets may be at risk, which can also affect investors' confidence in Bitcoin.
• Competitive pressure: With the continuous development of the digital currency market, more and more cryptocurrencies are emerging, which may exert competitive pressure on Bitcoin's market share and status.
Overall, Bitcoin investment still presents certain opportunities, but it also comes with high risks and uncertainties. Investors need to fully understand the associated risks and market conditions when deciding whether to invest in Bitcoin and make prudent decisions based on their risk tolerance and investment goals.
