Reasons why Bitcoin and other cryptocurrencies are on the rise again

After a while of being in a dip and causing massive sell-offs on the market, we are now seeing cryptocurrencies such as Bitcoin rising back up. On Monday, Bitcoin breached the $50 000 mark for the first time since May. Other coins including ethereum, Cardano’s ADA, and dogecoin also went up.

The most popular coin, Bitcoin, reached an all-time high that was close to $65 000 in April, only to fall back down with some strategists pointing at a further fall below the $20K mark. Unfortunately (or absurdly) for them, the coin is back on its feet with hopes of even higher strides in sight.

But why is this the case?

Read About: Uganda Blockchain Association agrees with the creation of Crypto Regulations

Why are cryptocurrencies like Bitcoin rising again?

Some analysts point at the Cryptocurrencies’ latest rise as a sign that Bitcoin miners are back in business after a recent Chinese crackdown. Similarly, it could also be that there is more mainstream acceptance of the coins. It is also believed that the cryptocurrency world is populated by a cast of characters whose voices can really influence prices. 

People like Tesla CEO – Elon Musk, Cathie Wood, and Twitter CEO – Jack Dorsey have been advocating for more usage of these cryptocurrencies and their followers certainly listen in.

Read About: Tanzania embraces cryptocurrency after President Samia urges for further research

Other reports point at how financial and consumer firms over the past year have increasingly been embracing cryptocurrencies, giving the asset more legitimacy and driving up the price. Banks, brokerages, and securities exchanges have been gearing up to meet demand. 

Case in example: An Amazon job posting published online in July said the firm was seeking a “digital currency and blockchain product lead”. After people found out about the post, bitcoin surged to about $40 000. 

Read About: How to quickly get your COVID-19 vaccination certificate in Uganda

Investor advice

If you’re investing in cryptocurrency, expect volatility to continue. Particularly, experts recommend that you keep your cryptocurrencies investment to less than 5% of your total portfolio.

Just like you shouldn’t let a price drop influence your decision to buy crypto, don’t let a sudden price increase alter your long-term investment strategy. Even more importantly, don’t start buying more crypto just because the price is rising. 

No matter if crypto is going up or down, the best thing you can do is to not look at it. Set it and forget it like you would any traditional long-term investment account.

Read About: A rundown of the StarTimes Uganda packages and prices

Stay on top - Get the daily news in your inbox