At the moment the world is in one of the hardest crises it has ever faced. We refer to the coronavirus, the disease that has occurred in Wuhan and has already caused thousands of deaths. Without taking into account the financial damage it causes worldwide, and that has even affected Bitcoin’s price. Get the crypto community to question its position as a haven of value.
Is bitcoin an oasis of value?
Bitcoin has evolved steadily since the beginning of 2009. When it was founded by Satoshi Nakamoto, a small community of crypto enthusiasts, it worked together in forums and internet chats to create the ecosystem around the first cryptocurrency. of the world.
Since then, Bitcoin has developed from a curiosity for fans of blockchain technology to a currency that is accepted by hundreds of companies around the world. Be able to use the cryptocurrency to purchase, trade, or even play in the several Bitcoin casinos available, for example on this website. Thanks to the security and trust that this virtual currency offers as a secure payment method for its users.
However, over time, the story around Bitcoin has changed. From a decentralized alternative to traditional fiat money to a crypto-user mind to a valuable haven.
That is, an asset whose price has no direct correlation with the international financial markets. In uncertain times when markets collapse, the price of these assets must be maintained or even increased. A pattern that the crypto community in Bitcoin began to observe and that made it known as “digital gold” of the 21st century.
The effect of corona virus on the price of Bitcoin
This representation of bitcoin as a reserve value has increased in recent years. They led to important figures in the crypto community like Anthony Pompliano and viewed Bitcoin as a refuge rather than a currency. Handover of this function in the background.
A situation that is gradually changing due to the influence of the coronavirus. Well, although initially the majority of the community saw the unfortunate disease as positive for the price of Bitcoin.
The past few weeks seem to have broken with these hopes. Well, the moment Covid-19 reached the western world and the exchanges around the world collapsed, the BTC broke down with them.
After experiencing a big bullish rally in the first two months of the year, Bitcoin lost all of the ground it gained in January and February and lowered its price by 49% in less than 24 hours. A disaster in the crypto market that fueled the debate.
Well, though Bitcoin’s price has recovered over the days leading up to the fall of March 12th. The truth is that this fall should never have happened. Well, the logic of value reserves is that when an event occurs that threatens to affect the global economy, such as the corona virus, capital seeks refuge in these assets and increases demand and thus price. Exactly what cryptanalysts predicted in the days before the crash.
None of this has happened. On the contrary, while gold suffered an initial shock, it recovered almost immediately from its habitual behavior as a haven of value. Bitcoin has experienced high price volatility in recent weeks due to the uncertainty caused by the corona virus. Contrary to the robustness expected by the crypto community.
What happens to Bitcoin after the corona virus?
All of these price movements on Bitcoin pose an important question for us. What happens to the cryptocurrency when the coronavirus crisis is over? And in the past few weeks, more and more analysts in the crypto world have withdrawn their support for the Bitcoin thesis as a haven of value.
However, this may not be all that bad for Bitcoin. Since then, cryptocurrency has been increasingly viewed as a purely speculative financial product in recent years. Abandoning its original goals of becoming a replacement for fiat money worldwide.
Therefore, the debate over bitcoin from the coronavirus crisis could be a moment of reorganization within the crypto community. This enables him to redirect his efforts to improve the platform and to increase acceptance among more and more users. And not so much for its quality as for a refuge of value.