Bitcoin is Performing like A Safe Haven Should Right Now. COVID-19 May Lead to Mass Adoption

The Better Call Paul Blog

[March 23, 2020   |   Jacksonville, Florida] 

Crypto-focused news outlets have already published stories analyzing the recent drop in BTC/USD value that occurred so drastically after the number one cryptocurrency initially seemed impervious to traditional stock market collapses that occurred in the wake of the pandemic declaration.  However, with President Trump's announcement that these "restrictions" will increase in scope and severity and will last through the summer, at least, with August being the month thrown out in which life will go back to normal. 

Normalcy seems to be what we are all hoping for right now, and with Joe Biden running an entire campaign on a "return to political normalcy," he may have a bump in the polls as a result of COVID-19 and criticism of the current government response to the crisis.  

In the cryptomarkets, there were many voices in the wilderness that called COVID-19  (and the impending financial depression that is sure to follow the outbreak) the death of Bitcoin, as well as "the death" of numerous other retail industries being forced to close to combat the spread of the illness.  

At one point, Bitcoin did the unimaginable and fell from a steady holding point of around $9500 USD to just under $4000 USD after news of the stock market crash and the coronavirus outbreak started to spread through a market already rife with volatility.  

Articles were published in which their authors just couldn't understand why Bitcoin dropped so much.  Wasn't it supposed to be a "Safe Haven" asset, like Gold?  

Well, the problem is -- people have started to look at the number 1 cryptocurrency as a positive store of value that would almost always make you money.  This just is not true.  Volatility is a part of the process, and those who have been involved in the cryptocurrency world for a decent amount of time understand that

Volatility is where fortunes are made. 

So, when it comes to bitcoin and cryptos in general, there usually two broad types of user: 

1.  The investor.  This is usually someone who spends all crypto-related time reading and studying the market predictions, placing bids and sales accordingly to make the best possible deal. This part of our crypto economy is concerned with profits made quickly, due almost entirely to the volatility that is built in to the system.  

2.  The HODLer.  This is usually a crypto-enthusiasts that generally believe that storing bitcoin and other prominent alts for long periods of time will result in large gains.  HODLers generally do not get too concerned with day-to-day or even reactional swings of volatility in the market.  

There are obviously pros and cons to being either type of crypto user, but the HODLers are least likely to be worried about the massive amount of wealth erased from Bitcoin's market cap after COVID-19 became pandemic.  

The COVID Cofactor:  Why Bitcoin Initially Crashed and Why it is Now King 

Coronavirus Spread from Handling Cash May Lead to Mass Adoption of Cryptocurrencies and CBDCs

After the WHO made the pandemic declaration, panic spread in across the nation.  Markets have fallen in the last few weeks to a point where every gain made under the Trump Administration has now been erased like it never happened.  Most people think this will be temporary -- not like the recession of 2008 -- and after the restrictions on contact and activity are listed, people will be itching to go out and spend and do things with friends and family, leading to a bounce back.  

However, other are not as confident, predicting that COVID will lead to a Great Depression-level meltdown of the economy.  

Upon all of this news initially breaking, Bitcoin was holding steady.  Then, a couple of large, "whale-sized" investors saw the opportunity to pick up some Bitcoin at half price.  So, they used their leverage and large wallets to make it appear as though a mass sell-off was occurring, causing BTC to drop below $4000 for the first time in a very long time.  

These whales turned around and bought up all of the newly sold BTC at highly discounted rates.  To put it into perspective -- those whales that scooped up cheap BTC for $4K have already made close to $3000 per Bitcoin profit in the 2 weeks since that occurred.  That is massive ROI, and super-quick, too.  

This is why those addicted to cryptocurrencies and blockchain tech as a whole play the game.  The whales that artificially crashed the market did so because they know there isn't much of a chance of a REAL bitcoin crash, and here is why: 

Bitcoin is not just an asset.  Entire industries have been built around it. 

Bitcoin will not die.  There are simply way too many lives at stake for it to crash.  There are ASIC manufacturers, industrial mining farms, exchanges, hundreds of thousands of jobs, and thousands of other commercial entities that all support the Bitcoin ecosystem.  To spread misinformation that there is an imminent bitcoin crash coming, remember to just HODL on to your coins, and don't sell when you start seeing downward movement.   

So, the billions that were wiped away just a couples of weeks ago have now just about been 65% restored.  

Plus, the COVID-19 outbreak has began a push from those scared that passing cash between hands could be a factor for the spread of the virus.  The UK is now in utter lockdown while the Bank of England is preparing for an "E-Pound Sterling" CBDC.  

Thus, COVID-19 may be the vehicle that bring our normies out there from being weary about digital assets to rushing to make the transition from cash among fears that the virus is spreading via cash.  

The money lost on during the COVID-19 and OPEC crashes, did not just disappear.  It went somewhere.  Into the pockets of the whales.

In the Bitcoin matter, some large institutional whales have become the beneficiary of the massive sell off scam, and then turned around and set themselves up for even more greedy profiteering by buying everything back, plus a whole lot more, when the BTC price dumped to under $4000.  The whole thing was a market manipulation to take advantage of the crisis posed by COVID and the OPEC cartel.  

Never let a good crisis go to waste, right whales? 

So, here we are right now, with BTC back on the rise and holding stead around $6700.  The stock market itself is not rebounding so well, however, as market forces become more and more certain that a terrible recession is coming following the COVID-19 and its containment. 

The moral of the story is that nothing has changed with Bitcoin.  Volatility has been built in since day one and we have seen these massive swings over and over and over again -- that is, if you have been part of the cryptocurrency sphere for any length of time.  

I hope you all stay safe and well, and remember that BTC is an investment.  It is a risk.  It's possible that you will lose money, so for those two reasons alone, I will leave you with the following 

Always, always do your own research (DYOR)

Never invest more than you are prepared to lose 

If you stick to those tenets of cryptotrading, you are sure to have a great experience.