Here’s how much you would have if you invested $1,000 in bitcoin at the start of 2022

Bitcoin has had a difficult start to 2022.

The top cryptocurrency fell below the $33,000 mark on Monday to its lowest point since July, before regaining some losses later in the day.

Still, the digital asset is down about 22% year to date, and roughly 40% below its all-time high hit in November.

That means that an investor who had put $1,000 in bitcoin at the start of the year would have about $780 in their account right now after just a few weeks of holding the volatile asset.

While such drops can be scary, they also offer a chance for people to review their financial plans and buy more cryptocurrency if it makes sense for them, said Tyrone Ross, CEO of Onramp Invest, a crypto-asset platform for financial advisors and firms.

“When something goes on sale and you like it, you should buy it,” he said.

More from Invest in You:
Companies raise perks to repay employees’ student loans
The ‘Zoom’ ceiling: Experts worry remote work will hold women back
Work-from-anywhere jobs are hard to come by. These companies have them

Room to grow

Even though bitcoin has struggled to make meaningful gains, bulls argue that the currency has lots of room to grow this year.

“I think [bitcoin is] going to reach $100,000 this year, probably by the middle of it,” Antoni Trenchev, co-founder and managing partner of cryptocurrency lending platform Nexo, told CNBC’s “Street Signs Asia” on Monday.

Other experts have made similar predictions. Matt Hougan, chief investment officer of Bitwise Asset Management, in an October interview with Bloomberg TV said that bitcoin could hit that $100,000 mark in 2022.

Analysts at Goldman Sachs wrote in a recent note that the firm could see bitcoin taking market share from gold and climbing to that key threshold.

In addition to the potential price action, cryptocurrencies have become an increasingly integrated and accepted form of payment.

“I think we’re not at mass adoption yet, but we are at mass acceptance,” said Ross, adding that for those who’ve done their research and decided that crypto is right for them, it’s a good time to jump into the investment.

Time in the market matters  

To be sure, you shouldn’t rush into any investment just because it is relatively cheap, experts say.

If buying crypto doesn’t fit into your long-term financial goals, you shouldn’t purchase it just because it’s trading at a relative discount, according to Ivory Johnson, a certified financial planner and founder of Delancey Wealth Management in Washington, D.C.

“If your time horizon is 10 years, I think now is a fine time to buy it,” he said. Otherwise, he recommends that investors take a more holistic approach to the asset class instead of trying to time a volatile market.

Investors should have a clear reason for buying crypto instead of being pulled in only because the price dropped, he said. Reasons include seeing the asset as a store of value, viewing it as uncorrelated or wanting to own it because of the increasing rate of adoption.

Before jumping in, people should be conscious of how much of their total portfolio is invested in cryptocurrencies and make sure the allocation matches their risk profile, Johnson said. New investors should have a firm grasp on how much they’re willing to risk before they buy.

“If you put 20% in crypto and you can’t stomach volatility, you’ve got what’s known as a problem,” he said. “But if you’ve gone 1% or 2% or 3%, it’s not as big of a hit to your portfolio.”

While you’re investing

Investors should expect that cryptocurrencies will continue to be volatile. The historically risky asset hasn’t been tested in an environment like the one we’re seeing today, where interest rates are set to rise, according to both Ross and Johnson.

“You should fully expect that [crypto] will go down further, so only put in what you can afford to lose,” said Ross. “If we wake up tomorrow and it goes to zero, you should be able to still pay your rent.”

Before putting money into crypto, both experts stressed the importance of having a secure personal financial situation and clear investment plan.

“If you dollar-cost average on the way down and also on the way up, it will smooth out that volatility and also enhance returns,” Ross said.

SIGN UP: Money 101 is an 8-week learning course to financial freedom, delivered weekly to your inbox.

CHECK OUT: How to make money with creative side hustles, from people who earn thousands on sites like Etsy and Twitch via Grow with Acorns+CNBC.

Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.