How does Coronavirus impact Bitcoin and its future?

How does Coronavirus impact Bitcoin and its future?
The Siliconreview
15 Decemebr, 2020

Can cryptocurrencies stay immune to the coronavirus outbreak? This is hard to believe because almost the entire world economy has been brought down to its knees because of the Covid-19. Whether it is the hospitality and tourism industry, educational institutions, small and medium sized businesses, almost everything has either been postponed or is still in limbo and no one is sure what the future is going to be like. It is widely believed that the virus is not going away at least anytime in the near future and this fear has caused quite a few market crashes as expected. However, the bitcoin trading bots execute the trade irrespective of these impacts and lessen the time and effort spent on manual trading. Go through this Bitcoin Revolution Review for more details.

With South Korea and China being in control of more than 70% of total Bitcoin mining power, the effect was likely to be felt almost right after the virus outbreak because the number of deaths in Asia were constantly climbing. With more and more people going into self-isolation and forced quarantines, there have been markedly less movements into the mining farms and this has taken a toll on Bitcoin prices.

In spite of all the negativity that is prevalent everywhere, one can still safely assume that markets will be able to survive and possibly even benefit from a crisis as this. While earlier the crypto market was not showing many changes because of the pandemic, changes cannot be ruled out and the market is not completely immune to what is happening around us. Crypto investors continue to be afraid of Bitcoin prices falling because of halving. Many futurists have found the crypto market to be completely safe and they have found it a viable option for long term investments. Actions of the global banks can also be positive for Bitcoin’s growth.

The crypto market had nose-dived in January-end when the pandemic first broke out. The virus paralyzed the demand and supply and this led to some of the biggest plunges in stock market history. But with China slowly bouncing back, there is hope that the entire world will be able to limp back to normalcy by the year-end. While stocks fell in January, gold prices began to soar, proving that it remains a safe haven for investors. Bitcoin, however, did not rise in value during this time as had been hoped. The reason may be that Bitcoin still lacks mainstream adoption unlike gold which is owned by individuals, banks, industries, etc. Investors have trust in gold and switch to it whenever there are such situations; but the Bitcoin still lacks this “trust”. It is held by only a handful of people and the volatility risks are great. Bitcoins are still not being used for buying all kinds of products; incidentally, people will try to sell their coins at such times to get more cash.

But Bitcoin has bounced back since and its onward trajectory is related to the virus’s spread. So, traders should find Bitcoin prices going up until the pandemic is at its peak. The bigger the impact on traditional financial systems, the higher will be Bitcoin prices. With market confidence falling, Bitcoin will stand to benefit. The trust of people in global markets and institutions will keep falling, and digital assets will start exploding in value, according to the managing partner of Kenetic Capital, a blockchain firm.