Bitcoin’s value rose to surpass the $40,000 mark in early February as the cryptocurrency recently recorded a drop in value to a point not seen in about half a year. This comes after bitcoin hit it’s all time high of slightly over $68,000 in November of 2021. The drop to around $34,000 in January has often been linked to the impact of a rate hike by the US Federal Reserve which had the effect of driving away investors from riskier assets such as crypto
At the time of writing this, the cryptocurrency gently hovers around $44,000. Seeing as bitcoin is the largest cryptocurrency by market cap amongst other metrics, it’s price gives an overall insight into the health of the crypto economy. This is evident as other cryptocurrencies are seeing a boost in their prices such as Ethereum crossing over the $3000 mark rising from around $2,400 which it fell to in January.
What this means for investors
As Bitcoin seems to be recovering again from its enormous dip, the outlook of the market still is tricky to determine. According to some analysts, there still exists the possibility that bitcoin would fall to as low as $10,000 in 2022 which would mean that the current bumps in value may be a short-lived affair.
Other analysts are more optimistic. During the heat of last year’s crypto bull run, many proposed that the value of Bitcoin could potentially hit $100,000. However, it was not to be as markets came crashing down and rapidly so. However, the optimism still holds and 2022 may very well be the year bitcoin becomes worth $100,000.
In any case, rather than a straightforward process, it may take some twists and turns to get there. In any case, the current state of things makes the situation a watching game essentially.