The beginning of the year has been a complicated few months for a lot of people. As the world faces the most horrific pandemic we’ve seen in decades, the economy has begun to stumble, with traditional fiat currency taking a massive blow. People who have spent years or decades investing their cash into long-term solutions for growth like stocks and securities have found themselves with nothing to show for their work.
As the panic continues, many financial experts are beginning to look to alternative currencies as a safe haven. Indeed, it seems that the those who have begun to invest in digital solutions like BTC (bitcoin) and other cryptocurrencies are the ones that are faring best in this difficult time. Bitcoin saw a plunge in value that took it down in the beginning of March, but it soon spiked back upwards again, gaining more consistent growth.
Is Bitcoin Really a Safe Haven?
In the past, many experts have referred to BTC as a safe haven, with other similar cryptocurrencies falling into the same category, thanks to their liquidity, and ability to move in the opposite direction to the Fiat markets. However, it’s difficult to know right now just how valuable Bitcoin is going to be. At the time of writing this piece, the price of BTC is once again trading at over 9.5k, after a massive drop of around 40% in March. These spikes in price suggest that Bitcoin CFD trading can offer value in the right circumstances.
However, just like any other kind of investment, it’s increasingly important to ensure that you’re buying and selling at the right times, for the right reasons. While it’s true that the marketplace has had a few bad weeks, it’s also capable of regaining strength very quickly too. The important thing to remember when looking at the sudden dips and changes in cryptocurrency value over the last few months, is that this unique form of money has never actually been tested in an environment of market panic. Digital assets grew up in an era after the financial panic of 2008, so this is the first time that it’s actually been put to the test as a safe haven solution.
Where Should You Invest?
Now that the value, and similar coins as well, is once again gaining traction, this could be a sign for traders that the next time the price drops, it’s a good opportunity to go and buy. However, just like any plan for growth and wealth management, your next step will depend on your strategy. It seems clear that cash and traditional stocks might not be the best way to protect yourself in the post-COVID environment. However, that doesn’t mean that this is the only option. There are plenty of other options out there to consider, including real estate and other coins in the cryptocurrency landscape. Like in most circumstances, the people who will be best protected going forward are the ones who know how to properly diversify.
