Disclaimer: This post was written around March of 2026!

About 4 months ago, I started investing some fun money in Bitcoin, dubbing it the great Bitcoin experiment. At the time, BTC was near a record high over $120,000. Which is just when you want to start investing in something, right? Wrong! Fast forward and my “investment” is down over 25%, with prices currently hovering around $65-67k as Bitcoin went into a severe dip (at the time of me writing this).

I keep investing $100 weekly now because it is just fun money and I want to continue to experiment. But it got me asking some questions. Like why did Bitcoin dip so much? Are there any fundamentals at play or is it purely speculation? Should investors buy the Bitcoin dip? Why are there such wild swings in value daily (on the order of +/- 3-7%)?

My research led down some interesting rabbit holes so I'd like to share them, framing things with my own investing “strategy.”

What is leading to the Bitcoin dip?

Based on my research, it appears to be due to a mix of macroeconomic pressures, market structure shifts, and crypto-specific dynamics. All fancy speak for a bunch of different reasons. Let's take a look at a few:

1. Macro market pressures (i.e. the world is crazy right now)

The world is a volatile place at the moment, even by the standards of the past couple of decades. There is war in the Middle East, oil prices are rising, and global uncertainty is at an all time high. All of this against the backdrop of rising inflation which dampens hopes for further interest rate cuts.

And when things are uncertain, investors get scared. And, despite all of the talk about the benefits of a decentralized currency, many even pro-BTC investors revert back to investing in “safer,” more time tested investments, like the stock market. In fact, it's an interesting finding that the stock market has actually been very resilient and even risen during and around wars in the past.

However, Bitcoin is a more speculative investment. And turmoil leads investors further away from speculation. And sharp corrections may follow, which we now see.

2. The way people invest in BTC is changing

Bitcoin, and all cryptocurrency for that matter, is being traded more and more in the form of institutional ETFs, rather than in the form of individual coins. In fact, more BTC capital flows through ETFs now daily than the amount that is being mined daily (expected as mining becomes more and more challenging as BTC climbs towards its finite final supply).

As such, price changes in Bitcoin, including this dip, now more reflect the sentiment of institutional investors, rather than retail investors (where I would wager the most ardent crypto fans reside).

Hence, factors such as those discussed above may have an outsized impact, as institutional investors are more likely to get scared off by the speculative component of the investment compared to retail crypto fundamentalists.

3. Bad leverage

Like the tulip craze, BTC saw massive bullish sentiment, especially at the crest of its value in late 2025/early 2026. That saw many investors taking on leveraged positions, investing on margin and the like. Not a solid investing strategy in general. But especially risky and ill-advised in a speculative field like crypto.

What happened is an old story. A small sell-off or correction cascades into greater sell-offs as investors needed to liquidate to cover leveraged investment positions. And then the price falls more, and more.

Ultimately, this type of thing can be helpful like when a fire burns down a forest so it can grow again as speculative excess gets flushed out. And then the cycle theoretically starts again as recovery appears. Is that happening now? No way to tell unfortunately.

4. Increased supply

Bitcoin is created through a mining process that is largely above my head. However, it started as a niche thing with individual miners minting coins. Now, it has unsurprisingly become very corporate. But it is also becoming more difficult and expensive. This is a built in feature as there is a limited, finite supply of BTC that will ever be mined. So mining the first BTC is way easier than mining the last one.

As a result, several crypto mining firms and companies holding large Bitcoin reserves have sold portions of their holdings. This adds supply to the market and drops price.

But on the flip side, as mining continues to get more difficult, supply should drop over the long term. So there are two sides of this coin…

5. Regression to the mean

If you have a baseball team that historically wins 50% of their games. And then they go on and win 10 in a row. What is the safest bet for the outcome of their next game? It's for them to lose. Because systems may always lean one way or another, but they always tend to regress to the mean.

Same goes for the stock market. And same goes for Bitcoin. BTC surged to $126,000 in late 2025. A correction was due. Now, no one can accurately predict when that correction will occur as a short term trend, but it's not surprising that it happened. And the degree of the correction is not all that surprising either. Large corrections seem to be the rule in crypto markets.

So context is important.

And all of this leads to the more practical question…

Should investors buy this Bitcoin dip?

Because it's always easy to say we knew why something happened in the market after it happened. But way harder (see, impossible) to tell the future. And while buying the dip proves to be a pretty sound principle when investing in the overall stock market, crypto is a different animal with way less history to go by.

Let's examine…

The Bullish Case: Why Some Investors Are Buying the Dip

• Institutional adoption continues: Corporations and firms still are buying more Bitcoin, signaling conviction from big time investors
• Fundamentals remain intact: The reason BTC became so popular is because it has a fixed supply and is decentralized. Nothing about that has changed. And compared to baseline, BTC value is still far above previous cycle lows.
• Cycle dynamics: Regression to the mean works both ways. And Bitcoin historically has demonstrated a dip before more bullish buying. Does that mean it will this time as well though?

The Bearish Case: Why Not to Buy the Bitcoin Dip

• Macro economic conditions don't look like they are getting better anytime soon: Inflation, war, global instability. Fear in investing is real. And speculative investments face the toughest test.
• BTC is mainstream: Like it or not, this is the case. It is an institutionalized investment now. This could mean more correlation to traditional markets (see: Are Gold and Bitcoin Correlating Assets?).
• Over-analysis?: Some analysts think that when BTC falls below $66k, then next valley it hits will be $58k. Why? Something to do with the Fibonacci sequence. I don't get it at all and it probably is all rubbish. But if someone is putting it out there, investors tend to anchor to weird things like this, even more so with a speculative asset.

What should you do?

Despite feeling like a Bitcoin sympathizer throughout much of this post, nothing about my outlook or my thoughts for yours really changes.

Here is my take in a nutshell:

• BTC is likely here to stay long term given institutional adoption and some unique advantage features (namely its decentralization and limited supply)
• It remains a largely speculative investment with massive short term volatility and a long term trend that is still being defined, as demonstrated by its range of responses to macroeconomic pressures
• I do not believe it should form the core of anyone's investment portfolio; it is simply too risky and volatile to bet your financial freedom on
• However, if you believe in it and have money you can invest in it and be comfortable losing completely (and see wild swings on a daily or weekly basis), go for it. The amount of that money will be different for everyone. For me it is $100/week.

What do you think? Should we buy the current Bitcoin dip? Why or why not? What do you think about crypto as an investment? Is it part of your portfolio? Let me know in the comments below!