Ginsberg explained that both Bitcoin and small-cap stocks are prone to extreme price fluctuations. This is primarily due to their relatively small market size and lower liquidity when compared to larger assets in the traditional financial market.
However, investing in Bitcoin, just like investing in small-cap stocks, is highly speculative. Investors often buy Bitcoin with the expectation of rapid price growth, focusing on short-term gains rather than considering the long-term fundamentals of the cryptocurrency.
Ginsberg further noted that the price of Bitcoin, similar to small-cap stocks, is heavily influenced by market sentiment. Positive news can cause a sharp increase in the asset’s price, while negative news can lead to a decline.
Considering these similarities, Ginsberg believes that Bitcoin may face challenges in reaching and maintaining new all-time highs in terms of market value.
Currently, the market value of Bitcoin fluctuates between $63,300 and $64,780, experiencing a 1% decrease in value over the course of a day. On a weekly timeframe, the cryptocurrency has seen a 2% decline.
Furthermore, the day before, Willy Woo, co-founder of the CMCC Crest venture fund, cryptocurrency analyst, and blockchain researcher, highlighted the unique nature of the fourth Bitcoin halving. He encouraged investors to consider investing in Bitcoin while it is still in its early stages.