The bitcoin price continues to rise at a steady pace. If you haven’t already started looking into cryptocurrencies or Bitcoins as an investment, now is the time to start. The cryptocurrency is turning heads to investors and the world’s economy.
Not just for being volatile, cryptocurrencies have established themselves as an asset class that can’t be ignored anymore. As a result, the Chinese government has decided that it’s time to take action and regulate its booming market. So now what?
How Can Bitcoin Increase The Interest Of New Investments?
But if you don’t feel like investing in cryptocurrencies or Bitcoins, there are other options out there. Traditional markets are still doing great at the moment, so why not invest in them? Also, the crypto market is small compared to other traditional markets, which may be a good thing.
If it’s possible for the bitcoin bubble to pop, you can expect a similar drop in the traditional markets. Massive drops in investment will mean many people are looking for new opportunities, and if they don’t find it there, they may start trying out new investments such as cryptocurrency.
7 Factors From Which Bitcoin Can Collapse After Traditional Investments
- Lesser interest:
The bitcoin price to continue growing is due to its high demand and lesser supply. But if traditional markets drop, so will the bitcoin prices because of less supply and similar demand.
As a result, the lower prices may prevent people from investing in bitcoins compared to traditional assets such as stocks or bonds, which proved their worth over the years.
- Mass exodus from the crypto market:
During bitcoin revolution collapse, people will start moving from cryptocurrencies to traditional assets such as stocks and bonds due to their stability. The investors may not want to take any risks by investing in a highly volatile market at the moment. In addition, during an economic crisis, returns on traditional investments are given priority.
- Disruption in economic psychology:
The 2016-17 rise of cryptocurrencies is due to the economic crisis during that time, especially in countries like China and India. As these factors started disappearing, the crypto market also saw a downfall.
Not many investors had faith in cryptocurrency’s future at that time. However, if the prices start falling in traditional markets, they will also be looking for ways to invest their money more safely.
- Shift in business models:
Traditional markets still have a lot of room to grow, but their growth is slowly shifting towards online selling and e-commerce businesses that are slowly taking over retail stores worldwide. The shift in business model will also result in the selling of traditional investment instruments such as stocks and bonds, which could lead to a bitcoin collapse.
- Discrediting cryptocurrency:
In 2014, major Chinese exchanges were shut down for a few days resulting in panic selling among investors. One of the biggest reasons for this was that people were afraid that the government would ban cryptocurrency or find ways to make it difficult for people to buy bitcoin.
This fear of getting caught may cause investors not to invest in whatever they can when there is a possibility of something like this happening again.
- Intro of new technology:
The birth of new investors is the death of the old ones. If you are new to investment, it’s best to look for information about all available types of investments. Bitcoins have been around for a long time now, and so many other cryptocurrencies have come up in recent years with better technology than before.
- Market correction:
During bitcoin collapse, the market will correct itself by bringing down the prices to a level where people start reinvesting. Although it might not be as high as before, it should be more than they are now. As you can see from the list above, cryptocurrencies will become the only option left if other markets fail.
Conclusion:
If the bitcoin bubble pops, the critical factor is that traditional markets are also in danger. So if people start looking for other options because of this reason, they’ll come across cryptocurrency. Naturally, this will increase the demand for bitcoins, eventually leading to a higher price than it is right now.
