Bitcoin Sinks to $30k: Is Now the Time to Buy?

The last six weeks or so have been a white knuckle rollercoaster ride for Bitcoin investors.

Having closed 2020 with 305% gains, rising 50% in the last two weeks of the year, Bitcoin hit $41k before consolidating, albeit in a rather volatile fashion,

The last 24 hours has seen the granddaddy of cryptocurrencies fall as much as 7.7%, slumping below $30,000 before rallying to $31,512 at the time of press.

So, with volatility and volumes being reported at the 5 Best Cryptocurrency Exchanges in 2021 and in the midst of a serious dip, is now the right time to buy Bitcoin?

At the moment, there is no clear reason for the Bitcoin plunge. The new Biden administration in the US is thought to be crypto-friendly.

Gary Gensler, the ex-chairman of the CFTC (Commodity Futures Trading Commission) and an ex-Goldman Sachs banker, has been selected to be the next chair of the Securities and Exchange Commission. Previously, Gensler taught about cryptocurrencies at the Massachusetts Institute of Technology.

No draconian measures are expected from Gensler and the new administration. In fact, the new administration’s purported attitude towards the crypto industry should bode well for crypto and the price of Bitcoin in general.

So, what else could be causing Bitcoin to lose over 30% in value since hitting a peak at $41,940 earlier this month?

Recent comments by Fed Chair Janet Yellen may be amongst the reasons for the decline. Yellen noted in her Senate confirmation that cryptocurrency is an area of concern for criminal and terrorist financing.

However, it seems that the dip is just that, a dip. There are more people trading Bitcoin than ever before. From day traders right through to institutional investors like Grayscale, the increase in trading will naturally cause an increase in volatility.

There is nothing to suggest that what we see now is nothing more than a dip. For investors, long term holding of nerve may well reap the $100,000 rewards. In that case, a buy now makes a lot of sense. For the day traders, there is plenty of volatility and potential profit ahead, however, not for the faint hearted.

So, buckle up because this rollercoaster ride is far from over yet.