Money, it seems, is by far the most tangible way to measure a technology's impact, as it awakens in everyone the desire to become rich overnight. Bitcoin has paved the way for hundreds of other cryptocurrencies to play that role in many lives. However, it's crucial to understand that the cryptocurrency market is highly volatile. Bitcoin didn't reach its previous all-time high of nearly $70,000, nor the most recent at $105,000 overnight; it took 15 long years of ups and downs to get there. In fact, very recently in its history, Bitcoin's price plummeted from around $67,000 to $14,000, leading many to believe that the cryptocurrency was finished. When these collapses in price occur, people tend to ignore the entire industry for months on end, sometimes missing out on the potential upside opportunities. It's important to note that I am in no way attempting to advise anyone on their finances, but if we were to draw a comparison to the real estate market, prices go up, and sometimes prices go down. The real estate market has experienced its fair share of volatility, often driven by external factors such as financial crises and pandemics. For instance, the global financial crisis of 2007-2008, triggered by the subprime mortgage crisis in the United States, had a profound impact on real estate markets worldwide. As credit markets froze and foreclosures soared, property prices plummeted, leaving many homeowners underwater on their mortgages. It took years for the market to recover, with some regions experiencing a more gradual rebound than others. More recently, the Covid-19 pandemic has had a significant impact on the real estate market. The initial uncertainty and economic downturn caused by the pandemic led to a temporary slowdown in the housing market. However, as lockdowns persisted and remote work became more prevalent, many people began to reassess their living situations, leading to a surge in demand for larger homes and properties in suburban and rural areas. This shift in preferences, combined with historically low interest rates, has driven up prices in many markets, creating a seller's market despite the ongoing economic challenges. In the middle of the crisis, I was offered to buy an apartment in a condo in Malaysia at exactly 50 per cent of its current price in 2024. The real estate market's ups and downs demonstrate that there is always a reason why any market will fluctuate. A financial crisis, a pandemic, another financial crisis, a war, and yet another war—all of these events can have a significant impact on market sentiment and prices. As humans, we tend to get excited when prices rise and turn our heads when they fall. However, it is clear that the best deals are often made when prices are down because the upside potential is higher. Conversely, the best time to sell is when prices are high, as that's when it's time to reap the rewards. The same principles can be applied to the cryptocurrency market. While the volatility can be intimidating, it also presents opportunities for those who are willing to do their research and invest wisely. In the case of Bitcoin, the cryptocurrency has experienced multiple boom-and-bust cycles over its 15-year history. Early adopters who bought Bitcoin when it was trading for just a few dollars per coin have seen their investments grow exponentially, despite the market's volatility. However, those who bought at the peak of a bull run, such as in late 2017 or early 2021, may have had to wait years to see a return on their investment, if at all.
STEFANO VIRGILLI
The author is a member of the International Press Association
Oman Observer is now on the WhatsApp channel. Click here
