Last month, a significant drop was observed in the value of some major cryptocurrencies. Bitcoin (BTC) and Bitcoin Cash (BCH) were among the cryptocurrencies that suffered such a fall. This was one of the biggest drops in almost two months. Understanding the causes of this phenomenon is critical if you plan to buy crypto from Switchere for example.
Switchere.com is an online platform that allows you to buy cryptocurrency with credit card. This has made digital money available to more people. Hence, potential investors must be well informed of value fluctuations of the crypto market to make the best decisions. More about how to use this website later in this article.
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Why Is Crypto Dropping in the Last 2 Months?
Some experts think that the value drop of some major cryptocurrencies is inversely correlated with the performance of the dollar (USD). The American currency has become stronger, which has caused other commodities to lose value as well. This inverse correlation was observed the other way around also.
While the dollar was relatively weak, one could convert a Bitcoin for over $12,000. But then, it plummeted again to its lowest value in the last two months. Some analysts state that oversupply is also linked to this drop of value. Bitcoin is the most traded cryptocurrency and, therefore, it somehow pulls other cryptocurrencies. When Bitcoin’s value falls, other cryptocurrencies follow suit more dis-proportionally.
Other Reasons for the Value Fall of Crypto
Most major exchanges including Switchere.com reported a Bitcoin fall below $10,000 on September 5, 2020. Ethereum (ETH) and some of its tokens like Esport Token (EST) had a significant fall too. It was reported to be as much as 10%. Analysts have summarized the reasons for this phenomenon as follows:
The first reason has already been mentioned, a strong dollar. After several months of bad performance, the American currency started to recover. Simultaneously, the euro started to devaluate. The value of commodities such as gold and Bitcoin is determined by the value of the dollar. Hence, as the US dollar strengthened, the crypto weakened;
Some miners, particularly Bitcoin miners, could be selling some of their assets. Miners usually send their BTC gains to an exchange that they trust. When they sell their crypto assets, the crypto goes to a different wallet. This creates some selling pressure, which results in the drop in the price of the cryptocurrency;
Whales may have been profiting, even since Bitcoin had a value of over $12,000. Some investors are willing to pay such amount for a Bitcoin.
All these factors have combined to cause a quick and sudden drop in the value of major cryptocurrencies.
Should You Invest in Cryptocurrency Right Now?
Because of the lower prices of cryptocurrencies, you may think this is the best moment to purchase crypto. The value fluctuations that have been observed in the last months show the risk of investing in crypto. Of course, this does not mean that investing in digital currencies is a bad idea. But you should not buy crypto with the money that you plan on using for your retirement.
However, if you get crypto at a low price, there is a possibility to make some profit. The crypto market is volatile and things can change in an instant. However, if you assume the risk and purchase crypto now, you could be rewarded with a long-term benefit.
How Can You Buy Cryptocurrencies Easily?
If you have decided to buy crypto, you should do it through a reliable platform. The crypto exchange credit card mentioned at the beginning of the article, Switchere.com, is a secure alternative. To ensure premium service for its users, this site implements the following:
Trading crypto anonymously is not allowed. Users must complete a registration and ID verification process. However, completing this requirement is easy and does not take more than a few minutes;
Fast purchases. The site has an integrated converter that allows converting fiat money to crypto and vice versa. It is also possible to convert a cryptocurrency into a different one. Its method to purchase crypto is the easiest in the market. You can buy crypto using a credit card. Otherwise, debit or prepaid cards will work also. Visa, MasterCard, and Maestro are accepted without any problems. To sell crypto, you must have a valid bank account;
No hidden fees. The amount to be paid is displayed on an electronic calculator. No additional fee or commission will be charged after that moment;
Non-custodial service, which allows your purchased crypto to be sent instantly to your wallet.
Moreover, this site has an attractive cashback program. Hence, if you want to get crypto now that prices are falling, do it via this site. This is the right place to create your crypto investment portfolio.