Cryptocurrency is a digital currency that is designed to exchange payments. The method of cryptography is utilized for the verification of transactions and the creation of new units of cryptocurrencies. The technique of encryption is used for the management of this system. Bitcoin is one of the units of cryptocurrency and the most popular one too. Some other units of cryptocurrencies are as follows: Altcoins, Litecoin, Namecoin, Ethereum, Cardano, and EOS. The entire process is decentralized that enables it to work independently, i.e., without any surveillance and control from the government. This way, no system can cause interference in it.
As far as the popularity of cryptocurrency is concerned, there has been an on-going debate. The merchants, traders, suppliers, and businessmen are still not sure about its utilization. That is why, even though the number of people who are willing to give a chance to cryptocurrency is increasing, more people are uncertain about it. There is a requirement of satisfying these people if cryptocurrency aims to become part of the leading financial system. To some extent, it is becoming successful and popular among people. Hence, many people are preparing to become part of cryptocurrency and plan to invest in it.
EFFECT OF COVID-19 ON CRYPTOCURRENCY
As stated earlier, this entire system is virtually based and lacks intrinsic value; hence, the susceptibility of the system increases. The system is prone to huge swings in price, which makes the entire system very risky, which makes investors more exposed to loss, if any. Now, if the current scenario of the world is put under analysis, it can easily qualify as the problematic period due to the outbreak of Coronavirus. Almost 100 countries are affected by this virus, which causes nearly all the systems to collapse to the ground. Out of all, the economic system is mainly targeted due to obvious reasons of crisis. Since cryptocurrency is aiming at becoming the main component of financial as well as the economic system of countries, it is also directly affected by the recent outbreak of viral disease.
DOWNFALL
Generally speaking, until 13th Feb, BTC reached a new high price, i.e., $10,502. Later after the pandemic, in the month of March, the cost of BTC experienced the fall and reached $3,791.9. However, it increased slightly, making it $5,000. The decreasing activity was not only reserved for bitcoin, but it also affected other variants or units of cryptocurrency. It is further revealed by the data that a 30% fall can be observed in the market where different units of cryptocurrency were prevailing.
The downfall was expected one; even then, it came as a shock because the price drop was not only sudden but massive too. Which is why various challenges arise for crypto exchanges. Due to this downfall, it was evident that investors are looking for the gate of exit. However, few people still prove to be positive ones and claim that Coronavirus will not affect the status of cryptocurrency, despite observing the data of downfall, shared previously.
EXPIRATION OF CRYPTOCURRENCY
It can easily be argued that the current economic crisis will mark the expiration date of the cryptocurrency. However, positive claims also exist, thinking otherwise. Various actions are being taken by the government of a variety of countries to retain the previous data regarding the economic system, and specifically crypto exchanges.
For instance, the ban was lifted by the government of India. It is targeted at not providing the services of banking to the companies of cryptocurrency. Moreover, various possibilities of blockchain are explored by the traditional market to include it in the financial system. Hence, development can be seen. A variety expects the recovery of people, its speed, however, can be slow.
Conclusion
Conclusively, it is essential to know this entire system before putting your investment in it. It is quite a fact that everything comes with its own set of advantages and disadvantages, and cryptocurrency is not immune to it either. People who enjoy the risk factor associated with such systems are more suitable to invest in it rather than those who cannot handle its uncertain nature. More specifically, when it comes to unexpected or emergencies, like the current outbreak of Coronavirus, it becomes even more challenging to think about these kinds of investments.
It is quite apparent that Coronavirus has its fair share in affecting the crypto exchanges, the way it had on the stock market. It is also seen that crypto assets are already en route to the path of recovery. Some of its points are even recovered. COVID-19 has a massive impact on the lives of individuals across the globe, which makes it very challenging to invest a considerable sum of money in something as risky, virtual, and debatable as cryptocurrency. One never knows what such kind of processes will turn into; a blessing or a dangerous step leading towards ultimate loss. Whatever shape cryptocurrency will take, COVID-19 will definitely have a driving factor in it. Stay stable and stay safe.
