The Corona virus is causing great panic in the financial markets and the cryptomarket is no exception. Bitcoin is leading huge losses and the various Altcoins are doing even worse, if possible. However, there is one group of winners. We put the Bitcoin drama in perspective.
How big is the loss for Bitcoin?
Bitcoin has to make huge sacrifices. In the last two days, the exchange rates fell by more than 40% and the value of the currency halved compared to last month. We see that the Asian stock exchanges are leaving their marks.
Which investors have been hardest hit?
Of course, the investors who buy the crypto coins are affected. However, they are free to decide when to sell. The chaos is much greater among the investors who trade in options. They give their portfolio of crypto coins as collateral for the options they buy. When there are such rapid declines, that value is of course reduced at lightning speed. If the value is not sufficient to cover the risks from the options, the platform will automatically liquidate the collateral. This happened yesterday.
The largest option platform in the world, BitMEX liquidated a record number of investors' assets worth $863 million in a single day. The liquidation wave continued this morning, liquidating $450 million.
Bitcoin loses, but there are still winners
Anyone who thinks that the situation only knows losers comes out cheated. Yesterday we already saw a record return of more than eight million percent and also in the last 24 hours there were winners in the misery. It turns out that although a group of investors took their losses from Bitcoin and large crypto coins, they did not exit the market for crypto coins. They 'parked' their money at so-called stable coins. These are crypto coins whose value is guaranteed by holding counterparts such as gold and US dollars.
What can we expect for Bitcoin and the crypto market?
Figures from Tradingview show that the cryptomarket was $ 301 billion last month. At the time of writing, a market capitalisation of $146.2 billion still remains and the market has almost halved as a result. This naturally has major consequences for confidence. However, not all signals seem to be on red.
