Bitcoin crashed earlier this week sending novice investors for the hills.
If you invest in cryptocurrency you're probably well aware of the somewhat befuddling mega-crash that happened earlier this week. Top coins like $BTC, $ETH, and the popular $DOGE meme coin came tumbling down in what felt like a panic-driven free fall to investors. New York-based crypto analysts and enthusiasts are seeing this as a good thing, though.
"What you call a crash, I call a clearance sale," shares Seth F (he declined to share his full name to protect his identity as publicly successful cryptocurrency investors are often the victims of cyber and real-life crimes)., a former Wall Street day trader who switched to the world of cryptocurrency assets in 2018. "When there's blood on the streets, there's money to be made. That line works with real estate, but it's also incredibly true for the world of coins," he says. "I've made enough money off these dips that I now have my primary home in Manhattan, one in the Hamptons, and an apartment in Los Angeles. If I'm doing it, anyone can do it. It's the whole see-the-good-in-the-bad thing, you know?"
Just yesterday the market saw more than $1 trillion in value wiped out across blue chips, alts, and even coins nobody has ever heard of. Almost no coin was spared the rod, and it's something some investors say is just par for the crypto course.
Chart via Coinbase
"The crypto market always has retracements," explains David Gokhshtein, CEO of Gokhshtein Media based in New York, and prolific Twitter head on the subject. "China impacted Bitcoin, and mining facilities turned their equipment off. When the public heard this there was some market sell-off which gained some momentum. Price stabilization always happens. And [ now ] the market looks stable again. Once Bitcoin retraced, trading volume plummeted. So an instant recovery was not available. When the public and institutional investors buy the dip, as they have, we start to see the market moving again."
At the time of writing this, the market has swung like a pendulum back to green positions with 24-hour gains on most coins. Bitcoin found mid-morning highs well beyond $34,000, a major improvement from yesterday's head-spinning dip at the $28,000 range.
"This is just a part of the blockchain industry," he adds. "Once you have gone through a few bull and bear markets, this is easy to watch and know how it all operates. If someone is happy when the market is up and worried when the market is down, they need to learn more and change their perspective."
It's something Seth agrees with, suggesting that if you believe there is value in blockchain technology, a dip here or there shouldn't scare seasoned investors off. "Sure, this is going to rattle the little guys just messing around on Coinbase or Binance with a couple grand, but when you are making serious moves, or a career out of this like I am, you know that what goes up must also come down. And that what goes down, will probably go up at least a few percent— when you're trading in high volume, a few percent is enough to pay all your bills for months."
Bitcoin is the great stabilizer of the entire market, it seems, and is responsible for the ups— however dramatic they may be, and the downs— even if they're full-bellied with fear.
"Everything trades against Bitcoin and is even valued in Bitcoin. We will only see true market stability when markets and projects give values in other formats," quips Gokhshtein.
For now, Seth believes Bitcoin will easily hit $35,000 by the end of tomorrow, and probably push closer to $40,000 in July. "This obviously isn't financial advice, but the whole thing is a boomerang. Expect to see 30 percent gains on some of these insane lows we saw from yesterday. I'm not saying Bitcoin is heading back to $60,000 any time in the next few weeks, maybe, but definitely putting a 30 percent or greater gain on the coin by mid-July or sooner would be my best guess. I already cleared 10 percent on Compound and Algorand this morning."
Were you impacted by yesterday's cryptocurrency market crash? We'd love to hear your thoughts and feedback in the comments section below.