Would Bitcoin bubble burst to prove the critics right?

Over the course of years, more awareness of crypto space and cryptocurrencies has been developed. Cryptocurrencies have quickly gained political support and business interest as more investors and traders have started to see its potential.

Cryptocurrencies like Bitcoin are a great opportunity for gaining profit along with providing a medium for storing profit for a long time. Its a renown fact that values of properties increase and decrease this is the same for bitcoin or any cryptocurrency.

The prices of an asset can increase for various reason like lack of stock, high demand or just a belief that some future change will influence the demand. But when high expectations result in disappointment then the value of the asset will start plummeting.

Another reason for the increase in the value of the asset is also that people are influenced by others and take more decisions based on the prevailing trend. The theory is called herd mentality and the act is called herd behavior.

Bitcoin stood stagnant at around five hundred dollars ($500) per coin, in the beginning, for almost about four (4) years. With the increase in advertisement and awareness in 2016 more investors and traders took a chance to try their luck in crypto space. This increased activity helped to raise the price of Bitcoin. At the start of 2017, the value increased up to one thousand dollars ($1000) and reached about twenty thousand dollars ($20,000) by the end of the year.

But as 2018 progressed the price value descended down to about thirty-eight hundred dollars ($3800) per coin which is the currently running value as well. This happened mainly because of the reason that Bitcoin was a little overvalued.

Despite all these hurdles, crypto space is still thriving. Bitcoin may be a good investment but knowledge of how the crypto market trends work is required to make rational decisions. Along with this, it is important for investors to know they shouldn’t take excessive risks and bite more than they can chew.

The main dilemma of investors is if Bitcoin is worth buying or not. The answer lies in personal investment psychology rather than analyzing the market trends.