Since the coronavirus pandemic started, the whole world has changed. The pandemic has affected all aspects of our lives, from how we go to work, shop, travel, interact with each other, pay for services, and pretty much everything else.
Every market has been affected by the Covid-19 pandemic – most of them in a negative financial way – but life goes on. People have to live, and businesses need to find a way to adjust to the new world.
Cryptocurrencies are no exception. Keep reading this article to learn about the state of crypto now and in the future, from the expert team at BitcoinCashpoint.
The Cryptocurrency Market
Bitcoin is a decentralized, digital currency that passes over the middleman, such as financial institutions and banks, and makes it possible to participate in trade worldwide even without a bank account of one’s own: A democratic currency model in the best sense of the word.
Like almost every other market and business in the world, the cryptocurrency market has been affected by the pandemic. If you are a trader or you are looking to get into the market one way or another, knowing how the market is coping during these times is essential.
Luckily, the experts at BitcoinCashpoint are willing to shed some light on the current state of the crypto market. At BitcoinCashpoint, they expect the market to bounce back eventually. Here is what they have to say.
The Effects of Coronavirus on Digital Currency Volatility
As soon as the world recognized that the pandemic was global, the whole crypto market started declining. Between February and March 2020, the entire market lost over half of its value. According to BitcoinCashpoint, the total value of all the cryptocurrencies dropped from $308B down to $118B before the second half of March.
For example, the most known digital currency in the world, Bitcoin, was valued at $10,500 in February 2020, and by mid-March, it was worth less than $4,100. Ripple’s digital token, called the XRP, dropped in a similar way, and it lost around 65% of its value during the same period.
Other big digital currencies also suffered. Ether fell by almost 70% within a similar period. During certain periods the stocks and currencies of the market both lost value. However, during other times, Bitcoin improved its value rapidly as the stock market plummeted.
That’s one of the first events of its kind on the crypto market. The people at BitcoinCashpoint even named the phenomenon “decoupling” since Bitcoin has never moved in such a drastically different direction in terms of value compared to stocks.
People are Questioning Bitcoin Safety
All of the crypto analysts swore by Bitcoin and were sure that this was one of the safest assets on the planet. Even during geopolitical and economic turmoil, investors could always rely on Bitcoin. BitcoinCashpoints reminded everyone of 2013 when people in Cyprus purchased Bitcoin to preserve their money as their banking system was in jeopardy.
This event triggered the rise of Bitcoin in value. So many people wanted it that it rose by roughly 80% in just a month. Just two years later, Bitcoin’s value climbed yet again when Greece had troubles with its debt. Everyone was buying Bitcoin to protect their financial stability, and this is when analysts started seeing Bitcoin as digital gold.
For a long time, Bitcoin’s value have been growing. That’s why so many traders and analysts put so much faith in it. However, when the effects of the coronavirus started to kick in and affect the crypto market, people weren’t so sure about Bitcoin.
However, even after falling down for a short time, by November 12th, Bitcoin had a value of over $15,000. It bounced back really quickly even though the overall market was dropping, which is why the people at BitcoinCashpoint are convinced more than ever that Bitcoin is a safe investment. For more details check the Bitcoin price index.
Many Saw the End of Cryptocurrencies
In less than a month, the prices of all cryptocurrencies fell during the spring of 2020 when the coronavirus spread globally. As we mentioned earlier, the decline in crypto currency value was so big, it scared a lot of people from investing any more of their money. Many currency holders suffered a lot of loss and looked for ways to sell their assets.
It turned out that they’ve made a colossal mistake. Even though the fall was high, currencies recovered in just a month. In fact, they bounced back so quickly that you won’t see the changes in many statistics. The biggest reason for why the value fell is that a lot of people got scared.
Everyone was looking to sell. Some because they were afraid of the virus, some because they needed cash to go through the pandemic, and some simply believed what they’d read online. For example, in March 2020, the value of Ethereum was under $250, but now it’s close to $500, more than the pandemic took place. For more details check the Daily Ethereum Value chart.
BitcoinCashpoint Expect Market to Rise
We are glad that BitcoinCashpoint shared their insights about the current market of cryptocurrencies. Even though the global market has lost its value, it’s very healthy. After all, every market has dropped due to the pandemic – it’s simply unavoidable.
However, Bitcoins and other crypto currencies have many advantages. It’s not owned or controlled by anyone. Instead, it’s backed by an advanced cryptographic algorithm, run by a network of thousands of computers around the world. Bitcoin’s advantages to traditional fiat currency are thus numerous: it’s permissionless, decentralized, censorship resistant, open source, fast, and pseudo anonymous.
The prices of the currencies are still rising, and the only reason the market is down is that people are afraid of saving up money to go through the crisis. That’s why experts at BitcoinCashpoint expect people to start buying once the crisis has passed.