Crypto and COVID-19: Have Stimulus Funds Resulted in an Increase in Blockchain Investment and Adoption?

Crypto and COVID-19: Have Stimulus Funds Resulted in an Increase in Blockchain Investment and Adoption?

By bettercallpaul | Better Call Paul | 29 Apr 2020

[JACKSONVILLE, FL | 04/29/2020 | W. Paul Alexander (Better Call Paul Blog)]  

So, while sitting tonight at my terminal, taking a break from writing an article for a client, I started having a conversation with my wife about Bitcoin, the COVID-19 Pandemic, the massive shift that all of our lives have taken since March 2 (more on that date later), and whether or not these conditions would be enough to turn enough people on to investing in blockchain technologies in general that mass adoption becomes a very real possibility in the immediate future.

A Couple of Things...A Disclaimer of Sorts

At the time of writing this article, on April 29, 2020 at 03:02 AM EST, the current state of cryptocurrencies, according to CoinMarketCap, is as follows:

Cryptocurrencies:  5,402

Markets:  21,499

Market Cap:  $228,438,322,248

24h Vol:  $137,826,603,226

BTC Dominance:  63.7%

This means that there is a total of $228.44 billion USD worth of cryptocurrency currently in circulation globally.

If you are new to this world and want to understand more about terms like "BTC Dominance" and "Market Cap", I suggest reading my article "Blockchain Tutorials," where I give comprehensive yet easy-to-understand definitions of some of the most common terms, definitely the most essential terms, that you will hear in the world of crypto.

Secondly, when I say "stimulus funds" in this article, I am referring to all activity since the passing of the CARES Act, NOT the smaller interim bills that were passed previously and only added a few billion to the economy as a whole. The CARES Act was passed in late March on the 27th. Because funds took quite some time to get to consumers and businesses under the first round of Paycheck Protection Program funding, we will look at these figures based on the state of the industry from April 1 to current.

Finally, I am not a financial adviser nor do I have any sort of "inside information" on these topics.  My research always comes from 100% open-sourced, royalty-free sources, but because I am not a financial adviser, you should consider this content academic in nature, not advisory.  As such, this should not be construed as "financial advice."

Please, always remember to do your own due diligence when it comes to researching projects, no matter how nice a project's homepage looks.   

Okay? So what.

Well, by knowing the market cap, we have the starting source of information that we can use as a reference point in determining whether or not direct stimulus payments have led to more blockchain investment.

Because we know today's market cap and today's date, it's a pretty simply operation to answer our question.

Since the earliest US stimulus payments would've had any effect on market conditions would have been April 15, it would make sense for even more investments to have occurred after that date as well.

So let's look at the historic figures.

On March 17, the market cap was at it's lowest at any point since the crash.

It was $131 billion at it's lowest that day, but by April 1, it had recovered to just a little over $181 billion, meaning that $50 billion in recovery had already taken place at the time the CARES Act was signed into law.

However, since that time, market cap has increased to almost $229 billion, meaning that an additional $48 billion has been added to the market cap since stimulus funds reached the hands of those who could invest.

Right, but...

Yeah, I know what you're thinking, and you're absolutely right -- much more data is needed to truly see what impact stimulus payments have had on the cryptocurrency economy.

While it's true that close of 50 billion in gains have been added to the market cap during our target time period, there have been many other things happening that have much more likely have had an impact on market cap than just stimulus payments alone.

First, volatility. BTC value and most alts have gained significantly in value since their lowest point during the COVID Cryptopanic. This is likely by far the largest contributor to the total market cap. These recovering values, while still not at pre-COVID levels, have definitely contributed a larger share to growth than "new money" personal investments as new token/coin purchases.

The other important thing to remember is that markets generally have started to rebound and gain over their crash levels, while still being hampered greatly by social distancing procedures. This has likely had a net positive effect on cryptomarkets.

So What do You Think?

Don't just read this article, interact with it! Do you think that stimulus payments and uncertainty about the stability of the fiat system have resulted in an increase of market cap and overall health of the blockchain industry? Was the inclusion of "digital dollar" language in draft legislation enough to turn others on? Was it the halving?

I'd love to hear your comments.

Here is an image of market position for the entire crypto universe, courtesy CoinMarketCap, taken as a screen grab at the time of publishing.


Hope to read all your comments very soon!



Other Ideas to Maximize Earnings Potential while Working from Home


While you are stuck at home, try getting involved with as many passive income opportunities as possible.  Of particular interest to me are some of the tried and true cryptofaucets that have been around for years and that pay out to the CoinPot microwallet.  If you are new to crypto, these faucets are the "moon" faucets and you can choose when to make your claim.  You are paid a small amount of crypto each time you make a claim -- it's not gonna make you rich, but it may keep you in beer money!  The cool thing is that you get 25% referral bonus on each of your referrals faucet claims as well as daily increasing bonuses for visiting at least once per day. 



What's cool about these is that they all go into the same single microwallet account, and they actually accumulate very fast.  I've been using all of them for years to stack satoshi in the background. It's definitely worth it when you realize one day that you have enough to pay your electric bill.  


Crypto Loans

  • Nexo

If you find yourself low on fiat but have a decent bag of crypto, consider starting an account with a service like Nexo.  They provide loans on collateral crypto so you can get the liquidity you need without selling your bag permanently.  Nexo is a great service -- I actually set all of my faucet earnings from CoinPot to withdraw to my Nexo account, where I currently have around $200 USD in crypto value with a line of credit of $100.  I've never used the line of credit, but it's nice to have, and it is backed by a HUGE $100 or 50 million dollar insurance bond, so you know your crypto is safe.  You can use volatility to your favor here, too, to make your loan higher, lower, or to actually make profit off of it.  It's completely free to join and participate, too.  They do have their own token, and it pays 8% staking interest annualized.  

Join Nexo here:

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Winner of the Publish0x 100K writing contest, I am a seasoned freelance creative writer with over a decade of writing and journalism experience. I love to write, cook, and learn new things. I look forward to contributing relevant content.

Better Call Paul
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