The worldwide COVID-19 pandemic has shaken up all industries, leading to some completely collapsing and shutting down, while the others struggling to stay in business. Cryptocurrency is no different in that regard. With most of the world staying home, many people have too much time on their hands and they have turned to crypto. The number of users has surged since the lockdown began in many different countries worldwide.
Governments are struggling to find ways to combat the novel virus while trying to support the economy so it doesn’t completely collapse. Many businesses are also trying their best to adapt to the new circumstances, by working from home and changing their businesses to be more online-oriented.
Earlier this year, when the virus was starting to creep up on Europe, Bitcoin and some of the other cryptocurrencies started to experience great demand, leading to a significant spike in prices.
For the first time in many months, the BTCUSD pair saw its price increase above $9,000. Many started regarding Bitcoin as a safe haven amid the uncertain times that the COVID has brought with it. Unfortunately, it didn’t take long for that title to disappear. Last month Bitcoin lost nearly 50% of its value on the cryptocurrency market in just one hour. The digital currency fell to as little as $3,867.09 from $7600.
Coronavirus impact on Bitcoin
As we mentioned, in the beginning, stages of the outbreak, Bitcoin saw a significant increase, but as time passed it was evident that the surge in prices wasn’t going to last. Even for the largest crypto trading brokers has been challenging so far. However, compared to other industries, the crypto market is still holding up pretty well, despite the challenges that the virus poses. From the 50% loss in March, the cryptos have managed to get back up at around $8000 mark quickly.
On April 20, the U.S. oil prices turned negative for the first time ever. There are different views on what it could mean for Bitcoin, but the experts are agreeing that compared to those industries which are reliant on physical delivery and such constraints. The fact that the virus has so significantly affected the oil industry is further proof that it represents a broken system that is extremely vulnerable and in need of a change.
More people embracing crypto
In addition to the bored people at home, crypto has also garnered a newfound appreciation from different governments worldwide. Being skeptical of the digital currency, or even completely banning it; amid the virus, many countries now have started to recognize cryptocurrency in their financial policies and courts. This could very well mark a turning point in the crypto entering the mainstream.
A French court ruled on February 26 that a Bitcoin loan was a consumer loan. Placing Bitcoin along with the more traditional assets in France, which reassures users that their property is covered by the law in the same way as money and other financial assets.
Cryptocurrencies have also become a sought-after resource for humanitarian and funding initiatives in the fight against the novel coronavirus. Bitcoin donations now are supported by a variety of big non-profits. In addition, some blockchain and crypto companies have taken steps to supply hospitals with medical supplies to try to stop the outbreak, while others set up fund-raising and charities to support those suffering from the virus.
Some charities which are known worldwide, like the Red Cross and Save the Children, have embraced cryptocurrency donations in an effort to fight the virus. Even before the virus, some large organizations had already implemented the next step in accepting donations. With Italy being one of the most affected countries, the Italian Red Cross was first to accept BTC, as well as other crypto donations to fight the virus.
The initiative was such a success that by the third day of the campaign the $10,710 fundraising target was reached. The charity has moved since then to raise more money through Bitcoin and other crypto contributions to reach a new goal of $26,000. With more such success stories of crypto fundraising, it is highly likely that others will follow the suit.
The recent months have shown that cryptocurrency is not immune to the fluctuations in the global financial market caused by the pandemic. However, promising data of more and more people utilizing crypto to fight off the common enemy sparks hope for the future of crypto in the post-COVID world.
