E-Crypto News in these times of the Coronavirus decided to talk to a few Blockchain executives to take their temperature (no pun intended) to see how the industry is holding up and there plans for the near future.
About CEO and Co-founder Steve Ehrlich:
- Over 25 years of experience in capital markets, starting his career at TIR Securities, an institutional brokerage that was sold to E*TRADE Financial.
- Former CEO of E*TRADE Professional Trading, which later became LightSpeed Financial. Under Mr. Ehrlich’s lead, Lightspeed Financial became the third-largest brokerage in the United States and executed an average of 450,000 trades per day by 2009.
- Current CEO and Co-Founder of Voyager Digital; co-Founded with Oscar Salazar, one of the co-founders and first investors in Uber.
About Voyager Digital:
- Voyager Digital is a public, licensed crypto-asset broker that provides retail and institutional investors with a turnkey solution to trade crypto assets.
- Voyager offers customers commission-free trading and safe custody on over 30 popular crypto-assets.
- They trade 3% on Bitcoin and 5% on Ethos, constantly announcing partnership to create a best-in-class digital currency brokerage and app.
- The company recently announced that it has listed three new stablecoins on its platform, Tether (USDT) and USD Coin (USDC), who are the founding members of Circle and CoinBase, and True USD (TUSD).
- Voyager Digital Canada, Ltd. (“Voyager” or the “Company”) (CSE:VYGR; OTCQB:VYGVF; FRA:UCD2)
The Coronavirus has had a major impact on global markets across the world – from inhibiting trade, to causing panic in the markets. The Fed has just announced a rate cut to help support the stock market, and we saw volatility across both stocks, precious metals, and Bitcoin markets in response.
The crypto market and Bitcoin were due for a healthy correction at the time markets across the globe dropped. We’ve seen both Bitcoin and the crypto market be correlated and uncorrelated to market trends – as it finds its footing in this market. There is a chance Bitcoin may correct further leading up to the halving, but after, we expect Bitcoin to pick up major momentum, as it embarks on a highly-anticipated bull-run in 2020. While the narratives of Bitcoin and whether it’s a true hedge are often as volatile as the market itself, one thing remains the same – the fundamentals of Bitcoin are drastically improving, from Hash Rate hitting an all-time high, to more global merchants utilizing crypto. Keep in mind, Bitcoin was born out of the financial crisis of 2008, and as an asset is uniquely equipped to handle these sorts of economic uncertainties. Whether it’s a cash ban in the U.S. due to the virus, or Global trade challenges, we see Bitcoin and crypto emerging as a white knight in the times of black swan events in the coming years.
The more this outbreak reveals the cracks in current economic policies, the better Bitcoin looks
The repercussions of the COVID-19 outbreak have battered global markets, including crypto markets. With stocks plummeting and the S&P 500 still in the red, crypto like Bitcoin and even safe-havens like gold have seen losses. Although over the past three months, Bitcoin has been up nearly 20%. In addition, some crypto exchanges have seen an increase in trading volume over the same three-month period since COVID-19 first emerged.
Sukhi Jutla, COO MarketOrders Author “Escape the Cubicle: Quit the Job You Hate, Create a Life You Love”
As with all financial assets market volatility can have a strong impact due to the panic and instability created when global epidemics occur. Most financial stock exchanges have been affected as investors are gripped with fear and worry. In most cases, it is fear that drives the markets! So I expect to see continued volatility in crypto-assets and markets as the Coronavirus pandemic continues.
Markets all over the world, whether it is stocks, gold, or crypto are now being examined closely due to the coronavirus. What makes the cryptocurrency market stand out relates to the creation of bitcoin itself. Satoshi created bitcoin because of the 2008 financial crisis in order to withstand future financial crises. Lots of people are comparing this downturn in the traditional financial markets to the one in 2008 and looking to see if bitcoin works. While the price has recently fallen from $10,300 to $8,600, it looks like the price is starting to rise again. Coronavirus stopped many miners in China, where the majority of mining takes place, but it cannot stop bitcoin trading worldwide. Bitcoin trades 24/7 all year long. The fact that bitcoin currently holds the majority of its value proves bitcoin works even in the most speculative of times.
I believe the coronavirus panic will have little marginal buying or selling in the markets for digital currencies. However, the likely economic fallout from dramatically lower oil prices, especially in Iran, Russia and Venezuela might very well cause increased trading activity in the more liquid digital currencies. I believe the run-up in BTC prices from $7000 to $10000 in January was almost entirely a function of the threat of war between the US and Iran and Iranians using any means available to protect their wealth from the prospect of a quickly devaluing currency in the event of war.
Todd Southwick Chief Executive Officer iTrustCapital
We see a significant drop in consumer sentiment when asked if they feel Bitcoin is the best investment in a global pandemic. Does this mean digital assets are a bad investment? My feeling is no. Consumers indicated increased preferences to cash in a mattress and US treasuries, while gold remained the top preference having not moved in any statistically significant way. What this tells me is that:
Consumers are not fearing a 2008 financial collapse as they pick US Treasuries, and cash in a mattress.
Bitcoin and other cryptocurrencies are viewed as volatile high growth investments.
Per Tim’s comments on Iran, Bitcoin and other cryptocurrencies used as a transfer of wealth between countries without ready access to financial markets is important.
Bitcoin was the best investment I made in 2019, having bought in the high 3,000s and sold in the mid 10s. Similarly our clients are executing many sell-transactions followed by buy-transactions, profiting from the volatility of the cryptomarkets. If you are looking at cryptocurrencies as a safe place to store wealth, they are probably not the best option. If you can predict the volatility of the market as it is demanded globally for cross border transactions, you might stand to make substantial money. I believe that over the long term, the ‘halving’ event, and adoption are likely to perform for those that buy and hold.
Bitcoin is not a safe haven.
It’s a high growth asset. Although we see price drops that correlate with our data on sentiment, we don’t feel it’s the main driver of price. Rather it’s the increased adoption of real use outside of an investment vehicle that drives the price increases. Its primary use case is to move wealth in / from countries with capital controls. When we see threats of calamity in countries without ready access to traditional financial systems (Iran, North Korea, Venezuela), prices move up. Prices may drop as investors in cryptocurrencies seek more stable assets to diversify away from high growth -yet volatile investments like bitcoin. Yet, if we are correct that the fundamentals of cryptocurrency come from increased adoption in global payments and cross-border transfers of wealth, the fundamentals for the investment remain.
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