What cryptocurrency traders are now learning in 2022 is that what goes up, makes come down. There has not been any investment in history that goes straight to the moon and market downturns are normal when it comes to investing. Even world-renowned investor Warren Buffett has seen his Berkshire Hathaway Stock lose over 50% of its value multiple times over his lifetime.
Cryptocurrency is no different than any other investment. It is going to be impacted by economic conditions and traders’ sentiment. The best way I like to look at the “CRYPTO WORLD” is to compare it to the early 2000s dot com bubble. Companies would literally put a .com behind their name and the value of their company would skyrocket for literally no reason. This caused investors to follow the fads with investing rather than focusing on the fundamentals.
The fundamentals of investing aren’t sexy and are not likely to give you 100% returns in a day, but investing is a boring concept that if you compound year over year, you will find yourself in a league of your own.
For example, before the takeoff of music streaming on the internet, there were 2 viable options to listen to music while on the go. There was the ZUNE which was made by Microsoft and the iPod created by Apple. Which one do you remember? This will be a similar outcome in the cryptocurrency world, some coins will survive and others will go extinct.
Large corporations such as Walmart are utilizing blockchain technology and this is not going to go away because this will help corporations decrease the financial crimes they see year over year which may directly lead to an increase in their profits. This is the superpower of the crypto world, which is the “BLOCKCHAIN.”
LexisNexis Risk Solutions Report Reveals the Yearly Cost of Financial Crime Compliance Reaching $56.7 Billion, a 13.6% Increase for Financial Institutions in the United States and Canada Combined. With the “BLOCKCHAIN” if companies can cut their spending just by a few percentage points, their earnings will increase, resulting in higher profits.
Overall, investing involves risk and cryptocurrency is no different than any other investment. With the amount of different “COINS” someone can purchase, it’s important to make sure you do your research before blindly throwing money at something just because it’s a “HOT TIP.”