• Bitcoin DCA strategy from ATH would have generated profit, beat S&P 500
• BRC-20 tokens lose 600 million in market cap within four days
• Bitcoin drops to $26K as the result of Binance whales selloff
Bitcoin DCA Strategy Outperforms S&P 500
The cryptocurrency market has been volatile since November 2021, but investors can still find strategies to outperform the S&P 500. Glassnode data reveals that a daily $10 investment in Bitcoin since its all-time high has generated positive returns and outperformed the S&P 500.
BRC-20 Tokens Lose 600 Million in Market Cap
Within just four days, BRC-20 tokens lost 600 million in market capitalization. This was partially attributed to a drop in Bitcoin price, which fell to $26K after large amounts were sold by Binance whales. As a result of this volatility, divergence between long and short term holders developed and could set up a bullish squeeze.
Mempool Clears as Fee Paid Per Block Falls
Despite the recent price dip, the bitcoin mempool started clearing as fees paid per block dropped back to one. This suggests that miners are now able to process more transactions at lower costs than when transactions clogged up the network earlier this year.
Benefits of DCA Strategy Over Longer Time Frame
The dollar cost averaging (DCA) strategy benefits investors over a longer time frame by reducing risk exposure through consistent investing instead of buying large amounts at once when prices are high. Investing smaller amounts regularly helps reduce volatility and minimize losses while also allowing you to take advantage of opportunities that arise during dips in prices or when coins remain relatively stable for an extended period of time.
Conclusion: Seek Professional Advice Before Investing
While dollar cost averaging can be an effective way to spread out your risk, it’s important to remember that past performance does not guarantee future success and that investing should always be done with caution and due diligence. If you’re considering investing in cryptocurrencies or other financial assets, it’s best practice to seek professional advice before doing so.