Cryptocurrencies emerged in the time of crisis as a way out for people and that was noticed in multiple cases. Some say that citizens prefer digital assets during turmoil because of the stability it offers for transactions and settlements.
A recent study showed that Bitcoin and its compatriots had shot up in value as the severity of the Coronavirus increased rapidly across the globe.
The spread of the virus has not just affected the lives of people across the planet but has also destabilized economies and financial systems. The Chinese markets have bled over the past few weeks with the disease taking an immense toll on capital transfer.
It is at this critical juncture that Bitcoin emerged as the unlikely hero. The analysis showed that Bitcoin’s value surged from the $7000 range to the $10,000 range just as the spread of the Coronavirus started. Bitcoin’s price on December 31 was $7251, the same day as when the virus was first detected. A month later on January 30, the price had peaked at $10,252. This was also the day when the World Health Organization [WHO] declared the Coronavirus outbreak as a national emergency.
The 10k barrier break was the first time that Bitcoin had crossed it since October 2019. And many have stated that it is because of the reliance on the world’s largest cryptocurrency. Since the start of the year, Bitcoin has spiked by more than 30 percent, while fiat currencies have had a hard time pushing the developmental envelope.
This is not the first time that Bitcoin has acted as a safe haven in troubled regions. In areas such as Venezuela, Bitcoin and cryptos such as Dash have worked wonders for the civilians. The large usage of Bitcoin on exchanges such as LocalBitcoin has also contributed sometimes to the increase in Bitcoin’s value. While the ‘being there when it’s trouble’ analogy sounds good, the real reason for the price hike may be something entirely different.
Bitcoin is slated to have its halving in May 2020, a phenomenon that usually leads to an uptrend. The last halving took place in 2016 where Bitcoin’s value double to its all-time high in 2017. The Bitcoin community has been expectantly waiting to see what dividends they can reap from the burgeoning economy.
The spread of the virus has had a drastic impact on companies, especially in the Asia-Pacific region. The region is home to 20 of the world’s top 50 cryptocurrency exchanges and the source of 40 percent of Bitcoin transactions in the first half of 2019. At this time, assets such as Gold were also on the rise.