BITCOIN has rebounded after crashing earlier this week but investors should still remain cautious as other coin prices have plunged.
The cryptocurrency’s price had plummeted to the lowest level since July 2021 but it has since begun to recover.
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Bitcoin is up more than 10% this morning, according to trading platform Coinbase.
It’s hit $30,212.53 after dropping as low as $26,401 earlier this week.
Myron Jobson, senior personal finance analyst at Interactive Investor, said: “Whether the uptick in performance is indicative of a full-scale recovery remains to be seen.
“What direction the price of Bitcoin and other cryptos will follow is anyone’s guess, but they remain a swashbuckling ride for investors.
“The recent crypto slide is a timely reminder that shows that just because something has perceived value, it doesn’t mean it can’t end up massively overvalued and in a bubble.”
Some cryptocurrency prices have dropped, such as Luna, which is down 99% in the last 24 hours.
Despite the Bitcoin bounce back, investors should still be cautious.
Cryptocurrencies are extremely volatile, meaning their value can plunge within seconds and you could lose all of your money.
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They can also be complicated and you shouldn’t invest in products you don’t understand.
You should also be wary of scams as cryptocurrencies aren’t regulated in the UK.
That means if you lose your money you won’t be able to get it back.
Bitcoin, and other cryptocurrencies like Ethereum, plunged in price this week, reflecting the global markets and fears over inflation and interest rate rises.
Bitcoin, the world’s biggest cryptocurrency, hit a low of $26,401 – below the level recorded in July 2021.
Even though the coin has rebounded above $30 today, the price is still below last year’s record high of $68,789.63.
The drop has also been prompted by regulatory crackdowns and bans in China and Russia.
Geopolitical tensions with Russia – the third largest crypto mining nation – and war in Ukraine has put pressure on prices.
Mr Jobson added: “Whatever your approach to risk, cryptocurrency should be treated with caution.”
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