The cryptocurrency market dropped 6.44% on Wednesday, indicating a market-wide crash that has lowered the overall market cap down to $1.38 trillion.
Check out Bitcoin’s drop in the live chart.
Crashing across the Market
The fact that Bitcoin (BTC) fell 3.48% may not seem significant, but this statistic is being recorded after a month of gradual decline and several days of relatively sharp decreases. Bitcoin is way below where it started off this year, with the BTC rate at $30,285 (BTC/USD) compared to the January 1st numbers of $46,726.
Ethereum (ETH) is down 6.21% today, hurting from a knock-on effect caused by Bitcoin’s decline. The more significant losses are further down the rankings, though, but you don’t have to look far. BNB (BNB) fell 12.11%, XRP (XRP) 15.97%, Cardano (ADA) 15.70%, and Solana (SOL) 24.29%, just to name a few.
This has had the effect of pulling down the entire market, with some cryptos seeing rates lower than they have seen in years. Some cryptos are experiencing massive crashes that have devastated investments, like Terra (LUNA), down 92% for the day.
Is It Safe to Buy the Dip?
There is a tendency for investors to jump at the low rates like these when they occur, and there is some wisdom in that, but we advise caution. Bitcoin is down 45% compared to this time last year and 34% for the year so far. It is showing a 45% decrease year of over year, approximately, making it a poor long-term investment.
You can find similar numbers with some of the other cryptos as well, which makes it hard to recommend any of them to long term investors. Short term traders, however, could turn a profit. There is great potential for these prices to shoot back up in the near future, though whether they will stay there for any length of time is another matter.
If you are going to invest in the dip, it is wise to do that only while keeping a close eye on the prices and sell before they plummet again. Good luck!
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