Bitcoin has been experiencing a terrible end to 2021, with its value dipping more and more as December comes to a close. A 6.77% decline was recorded by investors when they woke up on the morning of Wednesday, December 29. The recent decline started after early November, when Bitcoin was at its all-time high of $69,000. However, since then, the cryptocurrency has shed over $23,000. While many Bitcoin investors are now feeling the blues because of the recent downturn, there’s one expert who suggests that this slump may actually be good.
Fairlead Strategies founder Katie Stockton had warned previously that Bitcoin’s price had the potential of going into free fall if it dipped beyond $44,200. However, recently, Stockton said that despite Bitcoin’s slump, the fact that it’s hovering well above the $37,000 mark makes for a good sign of things to come. Stockton’s suggestion is that even though Bitcoin is experiencing a blip, its long-term outlook still holds positive. When the blip began, Stockton’s position on Bitcoin was bearish, but as time went on, she changed her position to neutral. Fairlead Strategies is a USA-based investment firm.
Other experts have suggested that the reasons for Bitcoin’s recent downturn include the emergence of the COVID-19 Omicron variant along with energy-efficiency concerns surrounding Bitcoin mining. The Omicron variant is bringing additional COVID waves to countries around the world, which has led to investors pulling money out of risky areas such as cryptocurrencies. Energy-efficiency concerns have already led to multiple crackdowns on crypto miners in China, and the risks associated with cryptocurrencies have also moved governments to consider regulation.