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After reaching a record high at over $120,000 last October, the world’s largest cryptocurrency has lost more than half its value.
The slide started when investors began pulling back from riskier assets amid geopolitical tensions, uncertainty over interest rates and a broader shift in market sentiment, with Reuters reporting in June (1) that Bitcoin was on track for its worst start to a year in at least a decade, having already lost about one-third of its value by that point.
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The latest bout of weakness came (2) when Bitcoin briefly dropped below $62,000, as investors were rattled by sell-offs in AI-related tech stocks, ETF outflows, cryptocurrency liquidations and uncertainty ahead of the Federal Reserve’s policy decision.
Against that backdrop, economist and longtime Bitcoin critic Peter Schiff argued in a post on X (3) that the recent weakness may be far from over.
“Despite the tech market carnage, the broader stock market is still holding up well, with the Dow Jones up over 400 today,” the post read. “I expect that to change as the correction spreads. The entire U.S. stock market is overpriced, not just tech.”
“I also expect a much bigger selloff in Bitcoin,” he added.
Schiff’s argument seems to rest on a broader market thesis: If today’s weakness spreads beyond technology companies into the wider stock market, speculative assets such as Bitcoin could face even greater selling pressure.
It’s a view that reflects how Bitcoin has increasingly traded alongside other so-called risk assets during periods of market stress. While Bitcoin enthusiasts may hail the asset as “digital gold,” its price has at times moved in tandem with high-growth technology stocks (4) as investors adjust expectations for interest rates, economic growth and risk.
Putting Bitcoin’s latest sell-off into perspective
Whether Schiff’s latest prediction proves accurate remains to be seen. The economist has spent years criticizing Bitcoin and has repeatedly argued that it will lose significant value.
At the same time, Bitcoin has experienced numerous drawdowns of 50% or more throughout its history, only to later rebound and rise to new all-time highs — underscoring just how volatile the asset can be over long periods. That history offers an important reminder for investors: Predictions, whether they’re bullish or bearish, are merely one piece of the picture.
The U.S. Securities and Exchange Commission (SEC) advises investors (5) to understand their risk tolerance before investing in volatile assets and to avoid making decisions based solely on short-term market swings or headlines.
In other words, existing Bitcoin investors don’t just have to think about where the cryptocurrency’s price is headed next. They also need to consider how much of their savings is tied to an asset known for dramatic swings. For prospective investors, the SEC’s guidance points to a broader consideration: They have to decide whether Bitcoin fits their financial goals and risk tolerance before they decide to buy.
Periods of market uncertainty often leave investors wondering whether they should stay the course, rebalance their portfolios or seek opportunities outside of traditional stocks and cryptocurrencies. While there’s no one-size-fits-all approach, understanding your options and building a strategy that matches your goals can help bring clarity when markets become unpredictable.
Stay informed before making major investment decisions
Bitcoin’s latest sell-off is also a reminder of how quickly sentiment can shift in financial markets. Just a few months ago, many investors were focused on the cryptocurrency’s long-term growth potential. Now, attention has shifted to whether higher interest rates, weakening appetite for risk and broader stock market pressure could trigger another leg lower.
That uncertainty is one reason investors often look beyond individual predictions, whether they’re coming from longtime Bitcoin critics like Peter Schiff or cryptocurrency advocates.
For investors trying to separate signals from noise, access to in-depth market research can make it easier to understand what’s driving both stock and cryptocurrency markets before making a decision.
For example, Moby offers expert research and recommendations to help you identify strong, long-term investments backed by advice from former hedge fund analysts.
In four years, and across almost 400 stock picks, their recommendations have beaten the S&P 500 by almost 12% on average. They also offer a 30-day money-back guarantee.
Moby’s team spends hundreds of hours sifting through financial news and data to provide stock and cryptocurrency reports delivered straight to you. Their research keeps you up to the minute on market shifts and can help reduce the guesswork behind choosing stocks and ETFs.
What’s more, their reports are easy to understand for beginners, so you can become a smarter investor in just five minutes.
Build a plan before markets become volatile
Whether Schiff’s latest prediction ultimately proves accurate remains to be seen. What history does show is that both Bitcoin and the stock market have repeatedly surprised investors who tried to predict their next move.
Meanwhile, investors who panic during market downturns often risk locking in losses or missing subsequent recoveries. That’s perhaps why the Financial Industry Regulatory Authority (FINRA) recommends (6) that investors establish financial goals, understand their tolerance for risk and avoid making emotional decisions during periods of market turbulence rather than reacting to every major market swing.
Having a long-term plan can also make it easier to evaluate opportunities consistently instead of feeling pressured to chase rallies or sell during corrections.
And once you identify those opportunities, you’ll probably want a way to execute the trade as quickly — and cheaply — as possible. For those investors, SoFi’s easy-to-use DIY investing platform lets you buy stocks, ETFs and more with no commission fees and no account minimums.
SoFi is designed for both beginners and seasoned investors, with real-time investing news, curated content and the data you need to make smart decisions about the stocks that matter most to you.
Plus, for a limited time you can get up to $3,000 in stock when you fund a new account.
Diversification extends beyond stocks and Bitcoin
Schiff’s warning wasn’t limited to Bitcoin. He argued that the broader U.S. stock market is also overpriced, suggesting the recent weakness in technology stocks could eventually spread across the market.
Whether or not that happens, his comments underscore a broader investing principle: Concentrating too heavily in any single investment or asset class can expose a portfolio to greater risk if sentiment suddenly changes.
Diversification can’t eliminate investment losses, but spreading investments across different asset classes may reduce the impact that one poorly performing investment has on an overall portfolio. For example, some investors choose to diversify entirely outside publicly traded stocks and cryptocurrencies by adding real estate to their portfolios.
That’s where mogul comes in. This real estate investment platform offers fractional ownership in blue-chip rental properties, which gives investors monthly rental income, real-time appreciation and tax benefits — without the need for a hefty down payment or late-night tenant calls.
Founded by former Goldman Sachs real estate investors, the mogul team handpicks the top 1% of single-family rental homes nationwide for investors.
Each property undergoes a vetting process requiring a minimum 12% return even in downside scenarios. Across the platform, investments have generated an average annual IRR of 18.8%, while cash-on-cash yields have averaged between 10% and 12% annually. Offerings often sell out in under three hours, with investments typically ranging between $15,000 and $40,000 per property.
Every investment is secured by real assets rather than the platform itself, and each property is held in a standalone Propco LLC, meaning investors own an interest in the property.
All you have to do is create an account, then you can browse available properties.
Some investors also consider alternative assets
Bitcoin challenged the traditional financial system by introducing a new type of investable asset. But cryptocurrencies aren’t the only alternative investment attracting attention from investors looking to diversify beyond stocks.
Institutional investors have increasingly expanded into private markets and alternative assets in recent years, seeking investments that don’t always move in lockstep with publicly traded stocks.
BlackRock’s latest Global Family Office Report (7) found that many family offices continue increasing allocations to private markets and alternative investments as they look to diversify portfolios.
One alternative that’s become more accessible to everyday investors is fine art.
Since 2019, more than 70,000 investors have gained exposure to works by artists including Banksy, Basquiat and Picasso through Masterworks, which allows investors to purchase fractional shares of blue-chip artwork.
Masterworks has sold 31 artworks so far, generating net annualized returns including 14.6%, 17.6% and 17.8%.*
Moneywise readers can get priority access by skipping the waitlist here.
*Past performance is not indicative of future returns. Investing involves risk. See important Regulation A disclosures at Masterworks.com/cd
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Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see ourethics and guidelines.
Reuters (1); Investing.com (2), (4); X (3); U.S. Securities and Exchange Commission (5); FINRA (6); BlackRock (7)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.