Since coronavirus (COVID-19) spreads globally in the last few months, governments around the world have had to take drastic measures. Along with other industries, this pandemic has affected the blockchain and cryptocurrency market.
The cryptomarkets are notorious for experiencing sharp price fluctuations, and the months where coronavirus fears grew haven’t made a difference. Shortly after the disease gained popularity, the broader cryptocurrency market began decreasing, losing half of its value between mid-February and mid-March.
Fall of the Cryptomarket in one month
As per the Coinmarketcap, the value of digital assets has been tracked down that the total market value has fallen from USD 308 billion on the 14th of February to less than USD 118 billion on the 12th of March. Bitcoin is the world’s largest digital currency by market capitalization — it has dropped from USD 10,400 on the 13th of February to less than USD 4,200 on the 12th of March.
We can see this trend with other cryptocurrencies, for example; Ether, known as the second-largest digital asset by market capitalization, has fallen more than 66% between this time period. XRP, the digital token used by the Ripple network has also experienced a similar drop losing around 66% of its value in this same time-frame.
What is happening in the market?
It is important to understand what has happened since Covid-19 hit the world. Initially, governments faced an economic crisis but the shock led to the change in a liquidity crisis — making investors and traders liquidate their holdings. All asset classes suffered, such as gold decreasing by more than 10 percent.
At times, analysts have described Bitcoin as a “safe haven” asset, depicting it as something that will remain in a position to grow as per its value. In March after the drastic fall, the crypto market was in a continuous struggle to gain its position in trading. There have been several arguments about whether bitcoin will serve as a safe haven asset for investors.
Cryptocurrency as a safe investment?
After seeing the recent change in the crypto market, bitcoin price has increased by 50% along with other cryptocurrencies i.e; ETH, XRP, USDT, etc. Due to the fact that investors are now open to trade and invest in cryptocurrencies. According to a study at the Frankfurt School of Finance and Management, crypto has a low correlation to traditional and alternative asset classes which makes it a perfect portfolio diversifier. Allocation of 1% to 5% of crypto will only generate additional returns and also increase the Sharpe-ratio.
Adoption of blockchain and new projects
In this pandemic situation, blockchain technology will continue to grow in the financial market ahead of any other industry. Applications such as food tracking, e-commerce, goods & services, and storage of sensitive data or information involve significant regulatory work to tie real-world objects to their tokenized equivalents.
Adoption of blockchain technology has become one of the most efficient and secure ways to run financial businesses. Many projects have approached LATOKEN for fundraising and IEO’s, as the crypto market is improving after the pandemic hit. Investors are considering buying new tokens and investing in promising projects. It’s quite possible that by the end of this year people may even see what mass adoption will look like.
Currently, LATOKEN VCTV is broadcasting top investors, analysts, keynote speakers, and other market influencers who speak about the current situation and investment opportunities.
Few top investors are listed below:
- Ali Saheli, General Partner at 7 Gate Ventures — 23 investments, last on March 2nd, 2019
- Anup Jain, Managing Partner at Orios Venture Partners — 58 investments, last on April 22nd, 2020
- Brian Halweil, Portfolio Manager Almanac Insights — 10 investments, last on January 15th, 2020
- Henry Chi, Portfolio Manager Capital Innovators — 107 investments, last on February 21st, 2020
- Julien Etaix, Investment Partner & Portfolio Manager Airbus Ventures — 46 investments, last on July 3rd, 2020
- Matthew Le Merle, Managing Partner Keiretsu Capital — 79 investments, last on July 8th, 2020
LATOKEN launchpad provides new projects with an opportunity to showcase their idea and become involved in panel discussions on VCTV.
Cryptomarket eruption, recovery, and conclusion
It is quite possible that the bullish trend of the crypto market will continue during this situation since the initial outbreak. Duns as the prices of digital assets will become half. Although the market has recovered to the incredibly complex nature of economics, making any confident predictions can turn out to be a fool’s errand. However, there is a possibility of the mass adoption of cryptocurrency.
Cryptomarket price movement is decoupling from traditional markets, governments are experimenting with blockchain-based currency solutions to stabilize the economy and thrust previously old-school traditionalists into the progressive 21st century.
LATOKEN provides real-time charts and graph visualizations via our mobile application and provides 24/7 support to handle all trading queries. Be productive and proactive in investments. Stay up to date with the crypto market.
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