Crypto Market & Bitcoin Could Boost After COVID-19 Pandemic?

After a stimulus from global central banks to stimulate their economy affected by Covid19 pandemic  and a recent renewed interest from institutional investors had brought rally in bitcoin price which led to higher levels in crypto market. Further, the Supreme Court has recently lifted the ban on cryptocurrencies in India.

Currently, several countries within the EU, Japan, China and India are experiencing a higher number of investors that are choosing crypto assets than before like recently Europe has shown interest in stable coins and altcoins.

Meanwhile, the blockchain system has been designed in such a way that there will always be a fixed number of coins to be mined and so there will be little chance that economic crises, like the current one arose due to COVID19 pandemic will have any significant impact on the value of the crypto assets.

Bitcoin Halving

There has been sharp fall in the Bitcoin price. It peaked at $10,367.53 in mid-Feb and plunged to $4,994.70 in mid-March. This is on back of the phenomenon miners and experts refer to as Halving. Bitcoin Halving happens every 4 years or every time 210,000 blocks are mined. It had happened previously in 2012 and showed the same predictable fluctuations in the Bitcoin prices.

Bitcoin Halving occurs when the miners are rewarded a fixed number of bitcoins (50 BTC) for mining the first 210,000 blocks, but the one who mines the 210,001st block gets half the reward (25BTC) and so on. Since there are only a fixed number of bitcoins (21 million) similar halving events are expected to continue about every four years until 2140.

Opportunity for Bitcoin & Cryptocurrency during COVID 19

Many veterans are currently holding onto Bitcoins for as long as 7 to 8 years. The rise in the value of bitcoin has not yet decelerated. In fact, the value keeps rising as more and more investors will hold the cryptos on hope that crypto assets like bitcoin have the power to disrupt the current financial state of India and other novel coronavirus ravaged economies.

Moreover, Bitcoin and gold are always competing with each other for the status to be a more effective protective asset, and in this current pandemic situation, cryptocurrencies have some advantages. The metal owners are dependent on transport and logistics, and in this situation the economies are prone to supply disruptions and logistics issues. Meanwhile, Bitcoin is a digital currency that exists in cyberspace and is not limited by state borders nor transportation problems, which gives Bitcoin to be more in demand than gold.

On the other hand, Cryptocurrencies are being used to help fight the global coronavirus pandemic. Blockchain-powered donation platform Binance Charity have initiated a $5 million coronavirus relief campaign. A wallet has been set up for public donations, which can be made in BNB, BTC, BUSD, and XRP.

Risks

The crypto currencies industry are already dealing with various issues, like regulations, liquidity, scams etc and the coronavirus has also added to its worries. The governments all over the world are required to take strong policies for making regulation to make it easier to buy or sell or hold Bitcoin.

Till that happens, the crypto industry will continue to struggle amid all the uncertainty. Further, the trader’s welcome SC’s decision but there is still a lot of lack of information and regulation regarding cryptocurrencies in India. Hence, the focus of investors will not shift to Bitcoin anytime soon.

There is lot of opportunities to cryptocurrencies like bitcoin, but the traders should be cautious also