Why Is Bitcoin (BTC) Down Today?

Bitcoin rules the cryptocurrency world and is a household name for many crypto investors. It is the largest cryptocurrency in the world and has maintained a steady level of around $39,000 to $45,000 this year post recovery in 2023 and a stormy season in 2022. Investors hope that Bitcoin will regain its level of more than $60,000 in the coming time amid strong macroeconomy and positive inflation data. 

This guide by Forbes Advisor India explains if investors should run a mile or have hopes in the coin when Bitcoin was trading at 50% lesser than its highest peak at the beginning of the year. However, looking at the market now, BTC has upped its game and is trading at $42,917 as of Feb. 7, 2024. Let’s take a deeper look at it.

How is Bitcoin Performing?

The new year 2024, so far, is stable and has not yet experienced any downfall for the cryptocurrency. The year 2023 turned out to be a tumultuous year for the cryptocurrency, Bitcoin (BTC). In the first month of the year January, BTC was trading at the low level of $16,000, it touched its peak in July 2023 at $31,000 and pushed the market capitalization around 607 billion, since the year started. It has witnessed stability and growth at the end of the year and has maintained the level between $39,000 to $45,000.  As of Feb. 7, 2024, BTC is at $42,913 with a market capitalization of $841.76 billion.

Stubborn inflation and unsettling macroeconomic conditions in countries like the U.S. and the UK led BTC to fall below the level of $26,000. The current interest rate is between 5.25% to 5.5% post hikes by the U.S. Federal Reserve and the Fed Chairman Jerome Powell stating that the inflation fight will continue until rates fall to 2%, Bitcoin may continue to be under pressure as more details on inflation emerge.

Even with all these factors, some of the crypto investors believe that this is temporary and BTC will continue to showcase positive trends in the coming days as its much-awaited “halving” event is approaching. This event will see the BTC mining rewards drop by half a percentage and this might lead to Bitcoin’s upside momentum. 

Bitcoin Price Movement (One-Month Data)

As of February 7, 2024:

Source: CoinMarketCap

Post the 2022 deadly November crash, when Bitcoin was hovering around in the range of $16,000-$18,000 levels, it has now shown immense recovery, but is still almost trading 37.67% less in value since it reached its all-time high at $69,000 in November 2021.

but is still on the flip side. BTC is still almost trading 50% less in value since it reached its all-time high at $69,000 in November 2021. 

Here’s how BTC’s current price has slumped from its high point over the past one year:

As we can see, Bitcoin touched the crucial level of $31,000 and thereafter dropped in September but rose at the end of the year 2023. It is currently as of Feb. 7, 2024, trading at $42,917.

Bitcoin has witnessed ups and downs in the last two years and it is evident that the cryptocurrency faced a major downside. It also witnessed the U.S. Securities and Exchange Commission sued the leading crypto exchanges Binance and Coinbase amid accusations of evading securities and mishandling consumer funds. 

Why Does Bitcoin Fluctuate?

Bitcoin started the year 2022 with a positive attitude but has witnessed its peak by the end of the year. Unfortunate events and obstacles shook the prices of Bitcoin which led it to crash from $50,000 to $15,000 over the year 2022. 

Overall crypto market has seen price fluctuation including Bitcoin. This happened due to unpredicted macroeconomic headwinds and also the most recent fallouts in the U.S. banking system. Let us see various other factors that affected the price of Bitcoin fluctuate:

  • Post-Russia-Ukraine war effects
  • Unsteady U.S. banking system
  • Inflation fear in developed countries
  • Increasing interest rates in the U.S. and UK
  • Stringent tax regime in India
  • Due to the collapse of the largest crypto exchange FTX

The above factors triggered the prices of Bitcoin and made it fluctuate throughout. It also played a significant role in confusing the mood of the investors. 

Tips To Consider Before Investing In Bitcoin

Investing in cryptocurrencies is a very appealing concept to people and when it comes to cryptocurrency Bitcoin is a must-must investment, but you need to consider some tips before you go ahead and invest in Bitcoin

  • It is advisable and a smart choice to invest around 5% to 10% of your overall portfolio in Bitcoin
  • Treat your cryptocurrencies as a long-term investment plan
  • Analyze the market volatility of Bitcoin and then invest wisely
  • To maximize your returns, make sure you research thoroughly which is the best time to purchase and sell Bitcoin 

It is natural for you to wonder whether Bitcoin is a safe investment choice considering its instability and volatility. The entire value of Bitcoin is based on speculation and it is not a regulated form of investment like mutual funds or equities. It would be a great choice to consult a financial advisor who will guide you through the process of investing in cryptocurrency that suits your financial goal best.

Steps On How To Buy Bitcoin In India?

Once you have a hold and a bit of understanding of cryptocurrency and are ready to invest in Bitcoin, the next thing you need to know is how to buy Bitcoin from India:

Step 1: Choose your choice of crypto exchange and create a free account either through their web portal or an application

Step 2: Register and verify your identity via their platform

Step 3: You will see a “BUY” tab and associated with it are many cryptocurrencies. You have to click the link that is attached to Bitcoin. 

Step 4: Buy bitcoin through the link and select any mode of payment like credit or debit card, net banking  or adding funds in the form of INR

Step 5: Once you make the payment and purchase bitcoin, it will either be stored in your exchange account or personal digital wallet. You can sell it anytime you wish or simply trade for other cryptocurrencies. You can stake it to obtain passive income

Bottom Line 

Investing in Bitcoin, especially from India, isn’t as straightforward as it appears given the Indian government’s keen…

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