The world is experiencing a major disruption in economic activities due to the coronavirus effect. In the midst of this financial chaos, what is Bitcoin, Ethereum and Litecoin?
As the days go by, Covid-19 continues to destroy at an alarming rate, affecting millions of people worldwide. This effect is enormous that the World Health Organization (WHO) announced on March 11 that it was a pandemic. The world is experiencing a major disruption in economic activities. So in the middle of this financial chaos, what is the world of Bitcoin (BTC) and the crypto world?
Since 2010, Bitcoin has introduced the crypto world to the financial market and assumed leadership. Believers in Bitcoin have grown, and this number has risen as more investors turned to Bitcoin, a faster and safer alternative from the fiat money system.
But again, the BTC that was about to climb up stumbled. With the coronavirus epidemic, which began to spread from the beginning of the year, BTC, which increased to 10 thousand dollars in February, fell to 8 thousand. Then, when it fell to $ 4 thousand on March 16, it climbed up again and climbed to $ 7 thousand on March 20, which means a 75% increase in 4 days. So for sure, we are in a tremendously volatile time for Bitcoin.
While financial markets are subject to sharp losses worldwide, central banks will pump liquidity into the markets, possibly causing the fiat to fall in value. On the other hand, BTC has a limited supply and due to inflation, fiat can maintain its value as its currency values fall.
People also prefer digital financial trades because of security measures. Banca Sella, one of the leading banks in Italy, started to provide trade services with BTC so that citizens can continue their financial transactions in cases such as paying during the curfew or transferring international funds. This is a big step for mass adoption of Bitcoin in Italy.
Ethereum (ETH), the second most valuable cryptocurrency, showed price increases with other crypto giants like BTC. ETH started trading at $ 125 on March 23 and rose 12% in 48 hours to $ 140 the next day.
Today’s crypto market volatility is further increasing as the struggle for recovery against Covid-19 continues. The ETH recovery in the past week gave hope to analysts. But on March 27, ETH stumbled again. Just after making a $ 140 summit, it fell, losing value by 7% in 24 hours, closing the day at $ 130.
Litecoin, another important name of the crypto markets, could not stand still. Despite the staggering $ 83 price hike on February 14 (yet $ 40 on January 2), LTC continues to drop sharply during the corona financial tensions and even fell to $ 28 on March 12. Despite this, LTC is showing a sudden recovery again and has held a steady recovery above the support levels since March 19. Recently it has been around $ 39.
Even though crypto prices are generally low at this time, statistics show that traders are actually buying more BTC rather than selling their assets. According to Google Trends and Twitter statistics, people are now interested in buying BTC. Also, crypto exchanges are experiencing an increase in new accounts and traffic records.
In the current global turmoil, the coronavirus seems to be the biggest challenge for Bitcoin and cryptos, but this could be an opportunity to prove its worth to the crypto world.
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