This pandemic raised the bar of the investor’s search for a safe haven.
The decentralized network of Bitcoin which avoids any involvement of banks and government excites new investors
Bitcoin supporters and promoters bet that Bitcoin could save the economy from the COVID-19 devastation
Bitcoin and other altcoins have witnessed a major breakout recently. The adoption rate has surged alongside the surge in the trading volume and market capitalization. This article presents the realistic reasons why investors are moving towards Bitcoin in this pandemic situation.
Top 5 Reasons Behind Bitcoin Investment During COVID
Investor Find Alternative Hard Money in Bitcoin
The COVID-19 pandemic has brought the economy to its knees with most of the world imposed a lockdown. With all the businesses shut, the monetary system crashed miserably with almost no circulation of the fiat currency in the market.
In this critical solution, investors find alternative investment ways to safeguard their funds. Therefore, Bitcoin attracted many investors as they found a substitute form of Investment.
Bull Price Factor
Bitcoin price has almost doubled in the last four months from the time the pandemic situation initiated. In March 2020, when the Bitcoin price was near $6400 surged to $11870 at the time of reporting.
During the pandemic, Bitcoin also witnessed its halving event which resulted in a drop in the hash rates then. But it recovered significantly and recorded its all-time high of 124THs recently. This clearly indicates more people mining Bitcoin which may pump up the price in the coming days.
Bitcoin Is Immune During the Time of Crisis
Bitcoin is decentralized, which is the prime nature that maintains anonymity. The absence of any controlling body(as in a centralized platform) could prove Bitcoin as a lone savior during a crisis.
Recollecting the 2008 financial crisis when the bank and the financial institutions broke down amid the real estate bubble. Then Bitcoin was very new to the market and was not capable of handling the crisis. Therefore, the monetary system collapsed which resulted in inflation and recession which impacted globally.
Bitcoin is an alternative for traditional assets as Gold
To date, the precious metal gold was noticed as a traditional asset and a mode of investment. In fact, the US dollar too was backed by the gold standard. Currently, the gold price has also touched its all-time high. But the unique features of Bitcoin makes it more investment material than gold.
As bitcoin is more divisible, portable, scarce and mainly they are predefined and limited to 21 million coins. Hence, bitcoin can be considered as a substitute for gold and other investment options. Moreover, the return of investment(ROI) of bitcoin in the last five years is the highest compared to Nasdaq, the Nikkei, or the DOW Jones.
Access to Low-Cost Cross-Border Payments
Most of the Bitcoin holders use the digital asset as the means of transfer of funds also internationally. The cross border transfers usually include bank transaction fees which might be higher at some institutions.
With Bitcoin, one can transfer them to any part of the world. Moreover, the recipient can easily liquidate the digital asset very easily. In many parts of the world, bitcoin is used as a means of payment and redeemed for their purchases rather than investments.
If you are new to Bitcoin industry – this famous comedian Bill Burr’s Bitcoin story will surely excite You
Conclusively, Bitcoin is the most exciting and promising cryptocurrency which made many millionaires. And its growing adoption in the current crisis has indicated the long and secure future of the digital asset. However, many analysts and researchers predict bitcoin to touch $100K or more in the coming days.
What’s in your investment portfolio? Did you consider Bitcoin as an investment during this pandemic? Let’s discuss via Twitter – tag us @CoinpediaNews