Coronavirus: Its Impact On Cryptocurrency Market
The impact of COVID-19 pandemic is felt no matter where you are on Earth. The crypto industry is one of the most affected sectors.
Experts say that this is the time where the stock market experienced its worst days over the past decades. This pandemic gives no certainty on how the global economic space would adjust to it. This article will tackle the positive and negative impact of the COVID-19 pandemic on the cryptocurrency world.
How Does The Coronavirus Outbreak Affect The Cryptocurrency Industry?
The most prominent effect of COVID-19 pandemic to the crypto world is the drastic dropping in cryptocurrency prices. The sudden change in the prices of cryptocurrencies is due to the flight in the liquidity of digital assets.
Because of this pandemic, a lot of crypto users panicked that is most of them used or withdraw their assets. Fortunately, as of the moment, the prices are slowly recovering making it a good sign that the cryptocurrency platform is a versatile and stable community.
This pandemic forced the closure of different business establishments that is why those who have digital assets experienced a decline in their asset values. There is no uncertainty about how things will work out on the different cryptocurrency platforms amidst this pandemic that is why investors and crypto users have a different point of view on whether or not it is safe and beneficial to continue managing digital assets through their platform.
Positive Impact of Coronavirus To Cryptocurrency
This pandemic was able to increase the demand for cryptocurrency, especially for traders. A lot of crypto users have a lot of time at home to better manage and monitor their digital assets. Since there is also an increase in cryptocurrency demand, it means that there are more offered opportunities or job openings for different company exchanges.
The more people who will start to explore and invest in the crypto world, the more the business will grow. The crypto world is one of the products of the advancement of modern technology that is why in this unforeseeable event, the crypto platform is able to survive. In China, Blockchain technology is useful in speeding up health insurance payments to be given to both COVID-19 patients and health-care providers.
The good thing about managing cryptocurrency assets is that ever since you tend to work remotely that is why this pandemic didn’t have much impact on how crypto users can access and better manage it, unlike other sectors that are forced to work from home.
The cryptocurrency industry is able to cope and adapt easily compared to other industries that are also affected by COVID-19. At this time, managing the crypto world remotely is one of the best ways on how to communicate efficiently across different time zones.
As an active industry in spite of this pandemic, the crypto industry has ways on how it can give back to the community. The Giving Block introduced the #cryptoCOVID19 that aims to give donations to those who were greatly affected by COVID-19 through the use of ETH and DAI.
Due to the pandemic, the trend for trading gains the highest volume among the different crypto activities especially for the largest cryptocurrencies such as Bitcoin and Ethereum. Since the trend for trading is upwards, it is good for crypto users to take this as an advantage. There is about a 60% increase in trading activities.
Negative Impact of Coronavirus To Cryptocurrency
The crypto business is one of the active sectors in the economical industry. Among the crypto activities, the conferences are the most affected since social gatherings are prohibited and travel restrictions are imposed. These crypto conferences that were canceled because of this pandemic are the TOKEN2049 and Blockchain Week that are scheduled last March 2020, the Nitron Summit, and the EDCON.
Aside from the canceled events, when this pandemic continues, there is a high possibility of capital authoritarianism and global recession. The popularity of cryptocurrency trading depends on the country.
For example, in the UK, crypto activities have dramatically declined that is why new investors have lost their appeal in trading and current users have a decreased activity in buying and selling. The way how the economy of a country is dealing with this pandemic greatly affects how the cryptocurrency behaves.
The mining equipment production is usually done in China that is why more than half of the mining operations have been canceled or postponed until the situation gets better. The price of the cryptocurrency has never been stable but experts propose that the trend is going downward. The common cryptocurrencies have lower prices but you’ll gain less capital.
Does Coronavirus Affect the Price of Cryptocurrencies?
The price of the cryptocurrency has never been stable; it can spike up or drop off instantly at any given time no matter what the economic situation is. The COVID-19 pandemic will not influence the price movements of cryptocurrencies for a long period of time, but because of this pandemic, crypto users panic in making sure that their investments through digital assets are secured.
Cryptocurrencies deliver convenience and ease of use in terms of saving money that is why in this crisis, crypto activities were in-demand that results in the price hike of common cryptocurrencies such as Bitcoin. Experts propose that the price changes of cryptocurrency are just a normal trend in the crypto world.
Role Of Cryptocurrency During The Pandemic
The use of cryptocurrency with the blockchain technology in the midst of this pandemic is a great tool in different kinds of situations to offer help. These are the ways by which the cryptocurrency platform helps in making different personal and government transactions convenient amidst this pandemic that the world is experiencing.
For donation tracking
When a cryptocurrency coin or token is used to donate to a particular organization, the platform has the ability to record and track the transaction until it safely reaches the destination.
For insurance claims
Most insurance claims are processed in person but since the pandemic has restrictions when it comes to human interaction, the use of cryptocurrency platform makes the processing of insurance claims more convenient.
For tracking the supply of medical materials
To be able to track the dispatch of medical items and maintain the steady flow of the distribution of supplies.
For tracking of data
The sharing of information among different organizations to see the overall COVID-19 situation is crucial that is why the cryptocurrency platforms assist in tracking data to deliver accurate information.
For cross border payments
With the advancement of technology, some cryptocurrencies also serve as a fiat currency that you can use to pay for goods and services. There are a lot of organizations in the private or government sector that utilizes cryptocurrency to accept donations or to accept payments for goods and services.
There are both positive and negative impacts brought by the COVID-19 pandemic but one thing is for sure, the cryptocurrency platform will still continue to thrive. As the world continues to fight back against this pandemic, the acceptance and value of the cryptocurrency to its users is still favorable.
Now is the time to see the versatility of the crypto world through its functions and how it can make your lives convenient amidst the pandemic the world is experiencing. Overall, the impact of the COVID-19 pandemic on the crypto platform also has positive points.
In this crisis, the crypto platform doesn’t only cater to its users but it also aims to give back to its community. Since there is a positive indication of recovery, it is safe to say that the cryptocurrency market is still a secured industry.