Nubits Drops Below $0.40, Which Offers Potential Risk / Reward

The Potential Risks and Rewards of Nubits

Nubits is meant to trade for $1 (it is meant to be a “stable coin“). However, starting around March 20th, its price began to drop. Currently, as of April 3rd, it trades below $0.40.

This has a few implications, but specifically two important implications from an investor standpoint:

  1. There is a risk that Nubits won’t recover and will instead drop further. The downside is 100% losses on an investment.
  2. If Nubits does recover, it should logically recover to $1. Thus, those who buy the coin now could see a 60% increase in their investment on the upside.

With that risk and reward in mind, it is worth noting that this is not the first time Nubits has lost value. In the past it has always recovered, so that point should be noted. Of course, its history of recovering accompanies a history of failing (which is worth noting too).

Understanding NuBits

Nubits has a complex system and history. I am going to forego trying to explain it in my own words and let the articles below speak for themselves.

To get a sense of the mechanisms behind Nubits and the history of its price collapses and recoveries I would point you to the following articles:

  1. Once considered a zombie project, is NuBits now rising from the ashes? (on Medium)
  2. NuBits History – What the heck has happened? (a forum post from the official site)
  3. NuBits Whitepaper (the whitepaper from the official site)

Why Bring this Up Now?

Although Nubits has been in decline since mid-March, the price has seemed to start stabilizing recently. Thus, now that it is no longer actively declining, it is starting to be more reasonable to consider as a possible buy.

Back in June 2016, the same thing happened, the price declined, started to stabilize (that time around $0.20) and then recovered. See the chart here for yourself.

It isn’t unreasonable to take a chance on that happening again.

Of course, I can’t suggest something like this. I’m simply bringing it up so people are aware.

Make sure to do your research and realize the risk you are taking.

You’ll want to research the whole NuBits system, including NuShares (the asset that backs NuBits), and you’ll want to understand why they are in the state they are (for yet another time).

Lastly, this is most certainly a situation that calls for you to be “be willing to lose everything you put in.” So be careful and reasonable if you go this direction.

Author: Thomas DeMichele

Thomas DeMichele has been working in the cryptocurrency information space since 2015 when was created. He has contributed to MakerDAO, Alpha Bot (the number one crypto bot on Discord),...

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