The Covid pandemic has largely Impact of Bitcoin the overall financial markets from all across the globe, including the market of cryptocurrencies. The experts from the cryptocurrency industry have expressed different views regarding the effect of the pandemic on the cryptocurrency industry.
The ways the coronavirus has affected the Bitcoin industry
The outbreak of coronavirus and the correlation between Bitcoin & the equities market has considerably increased. For instance, in the recent past, on 12th March 2022, the Bitcoin price fell below $4000 just after the S&P Index across the U.S. witnessed a very sharp decline. There will be a gradual increase in the price again. Several miners have capitulated, but this would not be much as the global economy is experiencing a very worse situation.
Will Bitcoin be a very safe option for investment as compared to the other investment options in the post-Covid era?
Bitcoin is not deemed to be a safe investment option like silver or gold, even though their present trajectory somewhat looks similar. Different narratives surround Bitcoin. Out of all of these, the biggest one is that the volumes are created because of trading. Many believe that investment in Bitcoin is a kind of gambling, and some assume this to be an investment that is similar to investing in digital gold. The U.S. government and FED are continually pumping many dollars into the Bitcoin economy. Until the time the dollar stays strong, it will be difficult for cryptocurrencies like Bitcoin to replace the same completely or dominate it.
Can Bitcoin tend to be the new preferred investment avenue for investors in the post-Covid era?
This does not seem so that more and more investors will invest in Bitcoins in the post-Covid era. There are times when nothing else really matters other than survival. Folks require liquid & cash assets. They usually are not looking for other assets like illiquid stocks and illiquid bonds. So, cryptocurrency is still not a preferred avenue for investment even in the post-Covid era. It will still require a lot of time for the nations to adopt BTC and treat it as a mainstream investment opportunity just like the stock market. The other reason for this is that the equities are still a very lucrative opportunity for investment even in the present times.
Is Bitcoin a highly liquid asset in comparison to equities?
The liquidity of Bitcoin has been increasing considerably in recent times. Several exchanges appearing in the market is doing a really great job in recent times. However, liquidity and volumes of Bitcoin even in the present times, are far lesser as compared to other avenues of investments. Also, there is a lack of information & regulation in regards to cryptocurrencies. So, the investors’ focus will not shift to Bitcoin very easily in recent times.
What is the future of Bitcoin once the global economy starts to slow down?
Coronavirus, including Omicron, has inserted a big effect on the cryptocurrency industry. The world was already dealing with several issues like scams, liquidity, and regulations, and this one has just added to our worries. Despite all the odds, certain new companies have come up in building several interesting products, but there are several ambiguities still revolving around Bitcoin. Although Bitcoin is considered a mainstream asset, this has not been institutionalized yet. Governments from all across the globe require to take bold measures to regulate all cryptocurrencies, including Bitcoin. Until these regulations are in place and implemented, the growing cryptocurrency industry will have to undergo a certain level of struggle and face various uncertainties.
These issues even got worse during the Coronavirus situation, but there will certainly be a positive ray of hope in the years to come. So, it is expected that the cryptocurrency market will be in a much better situation in the near future and more and more investors will come forward to invest big amounts in this investment avenue to make it a successful proposition altogether.
There are many exchanges for you to invest, however, the new and user-friendly app named Bitcoin Era is becoming one of the favorites of the investors. It is being appreciated by people from all the corners.