Corona Virus has infected thousands, killed hundreds and has got the globe trotters to think twice before stamping their passports. China is the world’s biggest supplier and is also the world’s biggest consumer at the same time, and hence, a calamity like a corona is going to bring serious issues to the global economic conditions. As per an analysis, China is expected to lose close to a trillion US Dollars due to this virus.
Bitcoin, Gold, and China
The global markets showed sentiments of fear due to the virus, but Bitcoin this has displayed growth amidst all this. Bitcoin crossed the 10,000 USD last week and is continuously showing strong support on this level. It went the highest tile 10,450 USD yesterday and is displaying positive upward signs. This may be due to its decentralized nature, as Bitcoin prices are not affected directly by such instances, but mainly due to demand and supply.
Bitcoin is up by almost 25% in the last one month.
As per CREBACO’s latest readings, it observed the Bitcoin mining difficulty slowing down as the halving comes closer, this may be due to the coronavirus outbreak in China as it is the largest manufacturer of ASIC (application-specific integrated circuits) mining machines. The new machines are due to be delivered but shipments and manufacturing are on hold as there is a complete cut out from China. China also has several large scale mining facilities that are focused on Bitcoin mining.
This incident proves a point many kept asking, ‘is China the power that runs Bitcoin?’ ‘No’. China may have a majority, but it still isn’t able to stop the Bitcoin Blockchain as the miners and nodes are spread across the globe.
On the other hand, CREBACO analytics observed many Chinese users to be active on major global exchanges buying Bitcoin maybe because of the anticipation that the Chinese economy is going to have a tough time economically after the Virus ends. The Chinese Yuan is expected to lose in valuation. This may trigger the much-awaited recession and give a push to Bitcoin as its something which is not related to the economy.
We also saw similar patterns in gold, as it also remained strong and showed strong and have increased approx 23% since Jan 1, 2020. When the prices of Gold and Bitcoin are going in the same direction, it may indicate something economically interesting which we may see in the near future. We have observed from the economic charts of the last 100 years that just before a financial recession, gold prices start moving upwards. This time it is accompanied by Bitcoin.
On the other hand, 100s of crypto conferences over the globe are now either canceled or are indefinitely postponed including Vietnam blockchain week, Singapore fintech events, along with 9 crypto conferences in Feb, March, and April. Events across Thailand, Hong Kong, Malaysia, and other SEA countries stand canceled. This is because the majority of the conference visitors and participants come from China Mainland.
‘Its terrible whats happening in China, May god give strength to China, and the victims of the Virus. I hope everyone takes care and follows precautions for not getting infected with COVID 19.’ said Sidharth Sogani, Founder and CEO of CREBACO Global Inc. in an interview.
He also added that:
‘Bitcoin is going strong amidst the alarming situation, this is setting an example that Bitcoin may be a good alternative for the populations which want benefits of decentralization during adverse events like these.’