As coronavirus outbreaks surge across the globe, it’s causing mass hysteria and disrupting economic markets. With the world factory, China, where the virus first emerged, on lockdown, global economies face an uncertain future. A lot has changed for some industries, including cryptocurrency, which saw dramatic shifts after China halted bitcoin production. The industry-wide shutdown of the Chinese economy is causing catastrophic disruption across global supply chains. Despite this dramatic shift, New York-based financial news syndicate, The Street, points out that bitcoin could bounce back.
Market analysts say, provided favorable conditions, for example, the unreliability of tracking measures and inflation could spur interest in bitcoin investments. Presently, China is a chief player in bitcoin mining, primarily because of low electricity cost, a critical resource in the process. Containing the infectious Covid 19 pandemic is proving testing for China and the rest of the world. That said, anticipations of prolonged delays for bitcoin mining in China are high.
The performance of bitcoin lately has a lot of investors and consumers skeptical as volatility spikes. With Covid 19 rapid spread, there is also a tremendous amount of uncertainty about the economic market as a whole. According to the latest market analysis, bitcoin user activity has seen a 0.62 percent downswing since the announcement of the outbreak. Also, developer behavior is losing traction, with the latest forecast showing a 2.13 percent drop. As of mid-February, bitcoin has been slowly declining at 1.23 percent.
Being the first-ever cryptocurrency to become a publicly-traded mining property on a mainstream decentralized peer-to-peer platform; bitcoin has some design limitations. The cost of mining bitcoin is an expensive model, which consequently translates to higher volatility and low transaction throughput. With these concerns spurring doubt about sustainability, developers have since introduced alternative bitcoin properties to boost scalability. These are areas that require some improvements, and worries a lot of seasoned investors.
Amid the chaos and unpredictable behavior of bitcoin these days, it is somehow enticing new interests; as citizens, especially in China, look to reclaim their independence. After the extreme measures the nation took to silence whistleblowers in the wake of coronavirus, it has left citizens feeling powerless. Now, distrust and fear remain at the top of Chinese citizens’ minds as the government commences its rebuilding exercise.
Without a doubt, this might drive Chinese citizens to consider bitcoin tokens as a safer banking method. Currently, the central bank is taking strategic measures to boost the economy and sterilize traditional money to quell public hysteria. There is high anticipation that crypto assets will benefit from this tragic revelation as the global population looks to build financial security.
