Is it just me who feels that this year has been extremely busy? I mean, it’s not even April yet and it feels like the year has had more events than 2018 and 2019 combined. Think of it, the year started with Donald Trump playing world War Three Chicken with Iran. Shortly after that Australia caught on fire, then there was a presidential impeachment trial in the US. And did you hear about the plague of locusts in Africa? And probably the saddest and most devastating happening yet is the coronavirus in China.
Cryptocurrency experts and enthusiasts would both agree that the global panic caused by the coronavirus has had a tremendous impact on the Bitcoin price this year. Right now, most people and especially those living in China prefer Bitcoin over fiat. I bet I would too since at a time of crisis and uncertainty people run to safe-haven assets to protect their wealth. Global crisis and geopolitical turmoil are often the reason behind the notoriously volatile Bitcoin price.
There has been a Bitcoin meme going around and it is commonly referred to as “This is good for Bitcoin“. And it means that Bitcoin finds a way to benefit from every situation whether good or bad and especially the bad. The Bitcoin prices have been climbing in direct proportion to the climbing fears surrounding the coronavirus pandemic.
Can you believe that Bitcoin has risen in price daily since the 23rd of January this year when the city of Wuhan was placed under quarantine? It’s crazy but at some point, the coin even gained nearly 10% in value within less than a week. It is currently trading at around $9,000 which is higher than its price in November last year. Notice, it is not just Bitcoin that is increasing in price and adoption but other cryptocurrencies as well. These include Ethereum, Ripple and Bitcoin Cash.
Cryptocurrencies seem to be mimicking the behavior commonly seen in gold, the classic safe-haven. Which as you would expect has also soared in recent days due to the coronavirus pandemic.
The coronavirus has given not just the Chinese economy but the world’s economy as well a depressed tone. Years back between 2002 and 2003, there was a similar outbreak of the SARS and the economy suffered greatly. However, once SARS was under control, the market returned to its natural level. The only difference between then and now is Bitcoin was not in existence then and the cure was found within a short period. With the coronavirus, it has taken more than a minute to find the cure and it is becoming apparent that the scientists are unable to restrain its advance or find its cure. Which means further panic and further economic turmoil.
Whether other countries will shift towards bitcoin because of the coronavirus, I can’t say. But one thing I can say for sure is that the coronavirus has caused mass adoption of the Bitcoin in China and it has changed the relationship of the Chinese people with the Yen. The price of Bitcoin has increased lately and the coronavirus has had a hand in that.