With the current cryptocurrency market crash, you might be in doubt as asking questions like, “should I still buy bitcoin”? “is it ok to buy crypto now?” “what will be the price of bitcoin by the end of the year?”
Well, these questions are normal and you are not alone in that thought. In this article, we will explain a few things for you to get a clearer picture and be able to make up your mind on what to do.
At the time of writing this content, Bitcoin, the world’s leading cryptocurrency is trading at $19,647. The continuous crypto dip has marred the interest of many investors.
As seen in this post, various events that have happened recently, like Voyager Digital (a leading cryptocurrency lending platform) filing for Chapter 11, Vauld (a top cryptocurrency exchange platform) pausing their withdrawal, and most of all, the collapse of LUNA crypto and some other similar events across the cryptoverse have left lots of doubt in investors.
Is it still safe to invest in cryptocurrency?
Founder & CEO of ClearTax, Archit Gupta talked about the price of Bitcoin. The price of the leading cryptocurrency Bitcoin first rose to its all-time high of $68,000 in November 2021. Not long after that, it declined and lost half of its worth, dropping to $35,000, and has continued to decline since then.
Right now, it lingers between $19,000 and $20,000. This is a clear indication of the level of volatility of the crypto market. Given the current events and the mass exiting of investors from the market, demand, and supply of the coin have been heavily affected and this makes the risk even worse.
Now, the Indian Government has set out a new tax rule, announcing that 1% TDS must be taken from all crypto transactions over ₹10,000. Gupta further said;
“ These tax rules will increase the regulatory and compliance burden. The tax rules have further increased the challenges as they may lock up the required liquidity to revive crypto markets.”
He also added that people invest in cryptocurrency without proper knowledge, and are moved mainly by influence and that these regulations will help to secure investors’ money.
Another expert, the CEO of TradeSmart, Vikas Singhania also stated that apart from TDS, the GST charges have also done more harm than good, adding more risk to trading cryptocurrencies.
Singhania also added;
“The TDS of one percent on Cryptocurrency implemented from 1st July is a dampener for trading in the asset class. While it may not affect investing volumes, trading volume in the sector will be surely hit. Just an example of how it will impact the trader -If a trader takes 10 trades in a month, he will have to earn at least 10 percent on these trades cumulatively, just to recover the TDS cosT.”
He continued; “On top of it, the brokerage, and GST charges have added more risk to trading in cryptocurrencies. Whatever residual profits are left will now be subjected to capital gains and other charges, making a profitable living off cryptocurrencies more difficult for investors.”
Meanwhile, Bitcoin is still trading at $19,000, down about 4.36%. It is more likely for Bitcoin’s current value to be cut in half and decline to around $10,000 than it rising to $30,000 according to over 60% of the 950 investors who did the MLIV pulse survey as reported on Bloomberg.
That wasn’t the same thought as the other 40% who saw it the other way round. Since Bitcoin rose to $68,000 in November 2021, it has lost half of its value and has not gone as low as $10,000 since September 2020.
Buying or investing in cryptocurrency should always be done solely at your own discretion. Always check history and compare it to the present situation and find patterns and similarities. This way, you Do your own research and find if you still have hope in a particular coin or not. If you find hope, you should invest, but if not, you should stay away.
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