any have wondered what will Bitcoin be doing in the short term future during and immediately after this global pandemic?
The Coronavirus pandemic has sent the world’s economies and stock markets into meltdown. And the cryptocurrency market has been no exception.
This turn of events has been a wake-up call for many in the crypto community who have consistently stressed that Bitcoin is digital gold.
The events of the last couple of weeks seem to have proven this to be untrue and has raised the statement “Bitcoin is not digital gold” largely due to its substantial price drop in the previous weeks.
All That Glitters
Historically, gold has been what is known as a hedge investment. This means that in the short term it may not make you a lot of money, but it will retain its value no matter what is going on in the outside world.
Gold indeed plummeted along with everything else as the seriousness of the Coronavirus hit home across the world.
As opposed to the rest of the markets, however, gold has now recovered and its current price is higher than that which it was at 1 month ago.
If it follows the current trend, the price of gold will soon reach or surpass its levels of one month ago.
So, gold is proving to be that hedge that all smart investors and the biggest financial institutions know it to be.
Cryptos are Another Story
In some ways, the Coronavirus pandemic is the kind of thing that many diehard crypto enthusiasts were waiting for.
Of course, nobody wishes tragedy on anybody else, but this kind of global crisis was supposed to be where Bitcoin and the crypto market showed its true worth.
Instead, Bitcoin is still down 28% on its price of 30 days ago. Ethereum, the second-largest crypto by market cap is down 46%. The third-largest, XRP, is down 38%.
Clearly cryptos didn’t get the memo that now was their time to prove that they are the future.
Could There Be a Silver Lining?
The 30-day price charts make for depressing viewing, but the 7-day charts are much more encouraging.
XRP is up 13% in the last 7-days. Ethereum 24%. And Bitcoin a very healthy 32%.
These upticks could suggest that the market bottomed out and that a bull market could take hold again.
One statistician who accurately predicted this flash sale of cryptos in the face of a global crisis certainly thinks so.
Willy Woo, an on-chain analyst predicted in 2018 that crypto investors would sell and seek out the US dollar as a safe haven in the face of a crisis.
Now he believes the stage is set for a massive bounce back.
“DUMP THEN [THE] MOON, WE ARE UNDERGOING FLIGHT TO SAFETY RIGHT NOW, BTC IS LOOKING FOR ITS BOTTOM. BUT KNOW THAT ONCE THE BOTTOM IS IN THERE ARE STRONG BULLISH PRESSURES AHEAD. IT’S THIS ECONOMIC ENVIRONMENT IN THE YEARS AHEAD THAT BITCOIN WAS BUILT FOR.”
Willy Woo via Twitter
In crypto speak “moon” means a scenario where prices soar rapidly to huge new highs, as happened in late 2017.
In a later tweet, Woo suggests that this kind of seismic event is exactly what bitcoin needed.
The world will be different when all of this is over and the baton will have been passed from boomers to millennials. At least that’s how Woo is reading it.
“THE INHERITANCE FROM BOOMERS TO MILLENNIALS IS TIPPED TO CREATE THE NEXT BULL CYCLE. THIS CRISIS IS A CATALYST FOR THIS EFFECT AS HEARTBREAKING AS IT IS. $68T OF WEALTH THAT WILL PASS HANDS IS NOW ACCELERATED. MILLENNIALS LOVE CRYPTO, DOESN’T TAKE MUCH MONEY TO MOVE THE NEEDLE.”
Willy Woo via Twitter
It remains to be seen what happens over the coming weeks and months, but Woo could be on to something here.
If he is, the post-Coronavirus landscape could look a lot brighter for those who are holding Bitcoin and other cryptocurrencies.