These can be anxious times for holders of cryptocurrencies, especially those who entered the market in late 2021 when prices were cresting. Bitcoin (BTC), Ether (ETH) and especially altcoins now appear to be undergoing a major reset, down 50% or more from November highs.
Some worry that a whole generation of crypto adopters could be lost if things crumble further. “If the market decline continues, it will become too painful and retail investors will bail,” Eben Burr, president of Toews Asset Management, told Reuters earlier this month. “Everyone has a breaking point.”
But, all the gloom and doom could be overdone.
It’s “unnerving,” acknowledged Callie Cox, United States investment analyst at eToro, but it’s only par for the course for a market that scarcely existed a decade ago. Bitcoin, arguably the most “institutionalized” digital coin, “has actually gone through 16 drops of 50% or more over the past 10 years,” she told Cointelegraph.
The current correction hasn’t deterred younger investors, according to Cox. “We surveyed 1,000 investors across age groups in March, and 58% of investors ages 18–34 thought Bitcoin would present the best buying opportunity in crypto over the next three months.”
Still, more recently, in early May, Glassnode reported that 40% of Bitcoin holders were underwater on their investments at a time when BTC was $33,800; it was $29,000 this past weekend on May 28. Are younger investors still as optimistic as they were in March?
“Retail traders between 35-45 years old decreased their crypto balances amid market volatility in the last few weeks,” Bobby Zagotta, CEO of Bitstamp USA and chief commercial officer at Bitstamp Global, told Cointelegraph. By contrast, “Our younger users seem to be more bullish and have chosen not to sell.” He added:
“Given the macroeconomic headwinds, every asset class is risk-off right now. That said, crypto and Bitcoin, in particular, are showing pretty amazing resilience.”
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