Price Dump Reduced Due to COVID-19

Endy Callahan

Price Dump Reduced Due to COVID-19

It appears that the dangers of COVID-19 have already affected most spheres of our life. It is still changing the usual course of things and those who deal with cryptocurrencies wish to know how the coronavirus and the financial crisis that it will bring can affect the market and whether its impact will be as devastating as some experts predict.

Expectations and Real Facts

Market crashes that frequently occur can change the whole trend. If you look through all the previous statistics, you will see that rises and falls follow some certain events happening around and it’s impossible to deny that the virus is inevitably going to change the economy of the entire planet. This includes the world of cryptocurrencies as well. COVID-19 recently became the factor that influenced the risks related to a halving price crash. A Bitcoin bullrun has been set – that’s what some analysts declare. The future of the cryptocurrency is hard to predict and foresee. Changes in its market can be rather negative at times.

COVID-19 is something that has changed a lot in the world of cryptocurrencies and a couple of days ago a group of industry experts met during Chainalysis. Their target was to analyze and discuss the ways in which COVID-19 have affected Bitcoin and whether it all will influence the further trends 

During the online conference, Chris Bendikson, responsible for research, said that he never ignored the fact that the fall which occurred in March made users prepare for the halving much earlier than ever before. This may flatten the instant effect it might have brought to the level of profitability. Moreover, the equipment was relatively outdated and that was one of the major reasons why some decided to perform upgrade while others even dropped out.

Experts tend to believe and predict that once the halving is over, the entire mining arena will gain more strengths. While in a relatively powerful position, its cost base will be lower. We should also bear in mind there’ll be a few months full of potentially hazardous moments. According to Bendikson, all this set everything up very well for a mid-term bullrun. He also added that what this leads to is most participants are very unlikely to do any sailings. The proportion won’t be any lower than before the halving. Trying to combine the two, it will mean that we’re most probably to witness a cycle in the making described, following the mid-term period.

Financial Problems Prove We Need Bitcoin

Alex Laughton-Scott supports the opinion of experts who state that the current crisis can have a beneficial effect on Bitcoin. At the moment he would like to find out how much change the fundamentals have gone through. He claims that there’s been no change. The global setup the market is going through is a key factor that proves the role of Bitcoin. Analysts consider its values as well as uses.

Laughton-Scott notices that all correlations might go to 1, especially during a crisis. Experts and analyst do research to foresee the possible change and inevitable results. To do so, they refer to the past experiences and compare statistics. It is an estimated fact that things typically flow in the same direction. In the middle of March he predicts a price drop that the low market cap would have boosted. Automated trades along with stop losses also had their impact and led to high volatility. At the same time, there are plenty of those who do not seem to share concerns related to the market. What we now observe is that the figures have definitely begun to go back to pre-crash levels.

Correlation may keep on declining and Bitcoin may keep recovering. As a result, it can become one of the ways to draw institutional demand. How true prognosis that specialists make is will be clear after a short period of time. What bothers most is that the crisis caused by COVID-19 may be something totally different from what analysts expect.