The spread of the new coronavirus in China has already led to a short-term panic in the financial markets. However, experts believe that cryptocurrencies can become beneficiaries of the epidemic.
For a week now, global news agencies have created panic among investors who are worried about the rapid spread of the coronavirus. Originated in the Chinese city of Wuhan, the disease is spreading throughout the whole world. As a result, many airlines were forced to cancel flights to China, and tourists pass through strict personal search at airports and border posts. Tourism industry, airlines, and related industries are being hit hardest by the outbreak.
According to the latest data, almost 8,000 coronavirus cases have been recorded (of which more than 98% in China) and 170 deaths. Isolated cases have been detected in many countries in Asia, North America, and Europe.
On Monday, prices of gold, silver, and bitcoin went up against falling stock markets. However, this trend has not taken hold yet, and in the following days, the markets are climbing up.
There’s a suggestion that Bitcoin was created as a response to the 2008 financial crisis which had serious consequences for the global economy. Over time, the cryptocurrency has been able to gain the interest of traditional investors, which began to consider Bitcoin as one of the hedging tools against geopolitical risks.
This was evident last year, during the escalation of the trade war between the United States and China. Then, the Bitcoin exchange rate has increased, as many investors believed that the crypto could protect their funds from financial market turmoil. It is noteworthy that this happened against the correction of stock indices.
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For a week now, global news agencies have created panic among investors who are worried about the rapid spread of the coronavirus. Originated in the Chinese city of Wuhan, the disease is spreading throughout the whole world. As a result, many airlines were forced to cancel flights to China, and tourists pass through strict personal search at airports and border posts. Tourism industry, airlines, and related industries are being hit hardest by the outbreak.
According to the latest data, almost 8,000 coronavirus cases have been recorded (of which more than 98% in China) and 170 deaths. Isolated cases have been detected in many countries in Asia, North America, and Europe.
On Monday, prices of gold, silver, and bitcoin went up against falling stock markets. However, this trend has not taken hold yet, and in the following days, the markets are climbing up.
There’s a suggestion that Bitcoin was created as a response to the 2008 financial crisis which had serious consequences for the global economy. Over time, the cryptocurrency has been able to gain the interest of traditional investors, which began to consider Bitcoin as one of the hedging tools against geopolitical risks.
This was evident last year, during the escalation of the trade war between the United States and China. Then, the Bitcoin exchange rate has increased, as many investors believed that the crypto could protect their funds from financial market turmoil. It is noteworthy that this happened against the correction of stock indices.
Continue reading
