Reports on Bitcoin taking a dip from a high of over $64000 earlier this year to a low of under $40000 in the past 24 hours have shaken the investors in BTC. That means that the value of BTC with respect to fiat currency has reduced significantly especially for those who had accumulated sizeable amount of BTC. But just how volatile is the crypto currency?
Well, it is normal for any crypto currency to be volatile given the exchange that happens in the market. One of the reasons is because crypto currencies are being used as a store of value. Given that the developers of BTC put a ceiling of only 21 million BTC, it's scarcity makes it valuable and investors may choose to store their assets as BTC just like gold.
Elon musk, the Tesla investor recently tweeted that Tesla was reconsidering its investment in BTC after assessing the environmental impact the mining of bitcoin had. This is after the giant electric car manufacturer had purchased $1.5 billion dollars worth of BTC earlier in the year. This single tweet has caused a 14% fall in BTC according to Financial Times. At the same time, Elon musk has previously positively talked about dogecoin, another Crypto currency, and that led to steadily rise of dogecoin price when he said "It's the future of currency. It's an unstoppable finance vehicle that's going to take over the world." However, when recently he hosted Saturday Night Live (SNL), he termed it a hustle leading to a drop from $0.65 before the show to $0.47 after the show.
Therefore, to sum it all price fluctuation is a normal occurrence in the crypto currency market. It may be influenced by statements by investors like Elon Musk since he has proven to sway the market. Investors are now keenly following on what he says and are cautious in their dealings with Crypto currency.
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