Impact of COVID-19 in the Crypto Market

In less than three months, the novel coronavirus (nCOVID -19) transformed from just one of the regular virus outbreaks in recent memories into a global pandemic, threatening to cause severe and drastic changes in the world’s most significant issues as we know it.

Many have already termed the latest pandemic as the not so anticipated “World War III,” as it continues to spread across countries and continents. However, there have been specific actions taken. These actions were to curb the aggravating situation and ensuring the globe doesn’t come to an impending halt in virtually every sector.

Impact of Covid-19 on World Economies.

Educational institutions, travel industry to public events, almost everything is either postponed or in limbo, which is inevitably going to affect businesses at every turn. Thousands of cases and deaths have already been recorded globally, and with the mere thought of this pandemic not going away anytime soon, stock markets began to take many hits in terms of new lows.

The S&P 500 index hit a new low since 2008 when the world plunged into a financial crisis. The crypto market has even become more volatile and has also experienced one of the worst sudden declines in its history. By the end of March 2020, there was a 6% loss in price, which occurred in the space of 24 hours.

Being one of the most affected nations by the coronavirus, and also one of the largest crypto markets in the world, the United States had its treasury experience a new low. Investors drastically moved from “risky” assets to much “safer” assets like gold and oil, which have experienced a spike since the pandemic outbreak.

Impact of Covid-19 on Crypto-mining.

With China and South Korea owning more than 70% of the mining power of bitcoins (the most substantial cryptocurrency), it is easy to say that the massive effect was expected as soon as the virus began to take its toll on the Asian continent, much less the world.

Over the past years, numerous cryptocurrency mining equipment has been devised, and with prices currently suffering, these pieces of equipment are exposed to certain inefficiencies. For balancing the new algorithms, mining farms became more and more critical than these pieces of equipment, which have been rendered ineffective.

Isolation and quarantine became the major causes of this because there is lesser movement into mining farms, despite the notion that investors term cryptocurrencies as “safe assets,” especially in times like this. The prices continue to suffer at the expense of the initial expectations. With an overall 15% drop at the end of March, it is expected that the number will increase even further when Q1 of 2020 is complete.

The Positives

Despite all the negatives emerging from all business sectors of the world due to the coronavirus outbreak, it is still safe to say that many markets are able to survive these trying times and even benefit from it.

There are no doubts that the possibility of a global recession and capital authoritarianism lurks in the shadows of these dark times as governments of the world are prepared to induce capitalism as a way of solving these problems.

Initially, the crypto-currency market might not be affected by these impending changes, but that doesn’t mean it isn’t safe from it, especially in the foreseeable future. This is because the world is very much prepared to use all available measures to fight back the pandemic using communication and medical technology to suppress the speed at which it spreads.

Return of investment is one of the significant keys of business, and the imposed lockdown in many countries of the world is an opportunity to utilize prices in trading according to financial experts. There have also been updated features of auto-software in tracking useful information for crypto trading such as charts, prices, and analysis.

Conclusion

The fear of bitcoin halving continues to linger in the minds of investors where prices will have to be cut in half to reduce its supply in the crypto market. Investors and experts have found this halving policy to be an interesting analysis in terms of balancing the books.

While many futurists have described the crypto-currency market as “beyond safe,” they have also stressed that it can also be identified as a good option in long term investments as the value continues to grow.

These analyses are also predicted to materialize in the coming months and will no doubt affect future prices in the future. The future remains the only place where we can be able to find the right answers. As the coronavirus (COVID-19) pandemic continues to record more cases — arriving in the future will be the only way to tell us how all things will eventually turn out.

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Adedeji Adewale

Adedeji Adewale is the founder of Digita-index, a professional digital marketing agency, and an entrepreneur who helps businesses and consumers with quality informative resources to keep them informed and updated, thereby creating a smarter and safer online community. He can be reached via Adedejiadewale1986@gmail.com

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