News

Technical indicators estimate that Bitcoin is about to plummet below $9,000
January 28, 2020 10:58 am
BTC Price Back at $9,000 But No, Coronavirus Isn't 'Good for Bitcoin'
January 28, 2020 10:58 am
BTC Price Back at $9,000 But No, Coronavirus Isn't 'Good for Bitcoin'
January 28, 2020 10:58 am

Bitcoin’s weekly gains will not see constant support from coronavirus uncertainty, trader says

Crypto cannot be substituted for cash, Deutsche Bank
January 28, 2020 10:49 am

According to a recent Deutsche Bank report, cryptocurrency cannot act as a substitute to a fiat currency because of high volatility and a number of risks they present to political and financial equilibrium.

While on the one hand, experts believe that cryptocurrency is the answer to the omnipresent issue of unbankedness in the world, the Frankfurt-based investment banking, and the financial services company Deutsche Bank feels that cryptocurrencies could potentially disturb the financial and economic stability.

Crypto puts financial stability in jeopardy, Deutsche Bank

In the first of its three series report called The Future of Payments, the Bitmain IPO sponsorer stipulated in its statement that there is still a long way to go before virtual currencies could become the “new cash alternative, despite them surpassing the inflection point to be in high demand. 

The report claims that cryptocurrency, as a technology, is still evolving and in its embryonic stage. However, considering the changes taking place surrounding cash, it poses a great danger to the overall equilibrium. And while that may be true, it also acknowledges that cash may be losing its steam after all, with several countries turning to digital payment methods as the most preferred mode of payment, thus placing cash on the backfoot.

Amid this transformation, the non-sovereign and decentralized digital assets pose a risk to the global monetary stability, states the report. 

Volatility is the biggest hurdle

It goes on to add that the high volatility of these digital currencies makes them unreliable, thus rendering them useless as a store of value asset. Citing an example from Bitcoin’s power-packed performance at the cryptocurrency market back in 2017, the report criticizes Bitcoin for being highly speculative asset, given the fact that it rose from one thousand US dollars ($1000) at the start of 2017 and ended the year with an all-time high figure of twenty thousand US dollars ($20,000), only to witness a sharp plunge to three thousand two hundred US dollars ($3200) one year later.

Despite it retaining its position since then, with nearly steady pricing of eight thousand seven hundred and eighty US dollars ($8780), the report’s authors claim that it still represents a negligible fraction global payments, even though cryptocurrency payment options finally gaining traction in recent months.

As the recent CoinMetrics analysis revealed, total Bitcoin transactions on the Bitcoin network amounted to two and a half trillion US dollars ($2.5 trillion) in 2019 as opposed to Visa’s total transaction volume of eleven trillion US dollars ($11 trillion) in 2018. Thus, Deutsche Bank thinks that Bitcoin also, despite having potential, may not entirely replace cash. However, a new mainstream cryptocurrency could.

Interestingly though, the bank released a similar report last year, Imagine 2030, which painted a contrary picture that cryptos could very well substitute fiat currencies by 2030 and that the forces affecting fiat currency growth may be shrinking in strength.

Featured Image by Flickr

Carbon Money Abandons EOS After Halting Stablecoin Product
January 28, 2020 10:46 am
One of World’s Richest Firms Joins Blockchain Trade Platform Vakt After $5M Investment
January 28, 2020 10:45 am
What is the Bitcoin halving?
January 28, 2020 10:40 am
WOW!! BITCOIN PUMPING RIGHT NOW WHILE STOCKS ARE CRASHING DUE TO CORONAVIRUS FEAR!!
January 28, 2020 10:39 am
No, Coronavirus is Not Good For Bitcoin
January 28, 2020 10:30 am
No, Coronavirus is Not Good For Bitcoin
January 28, 2020 10:30 am

It may be a coincidence that the cryptocurrency markets rallied when the news of the Coronavirus outbreak in China worsened — but to claim it is actually good for Bitcoin is absurd, to say the least. This is exactly the claim of one ‘respected’ mainstream media outlet.

Over $20 billion has flooded back into crypto-asset markets since the weekend. Bitcoin rallied again to top out over $9,000, and gold has also made a push this week.

The mainstream media is becoming increasingly clickbaity when it comes to ‘news’ regarding the cryptocurrency sector or Bitcoin. The Financial Times, which is usually considered to be above the rest of the tabloids, stooped to their levels yesterday with the headline: ‘Coronavirus is good for Bitcoin.

Incredulous Cryptocurrency Rants

The FT opened with a vitriolic barrage at bitcoin and its brethren stating;

“Don’t let moral anguish over the deaths of potentially thousands of people get in the way of an opportunity to shill some crypto and pump up the price of bitcoin.”

The article, which reads more like a personal rant, then went on to highlight a couple of tweets from obscure XRP supporters claiming that ‘dirty fiat’ may be causing the spread of the infections.

Bitcoin BTC Dump

The fact is that Bitcoin cannot possibly ‘benefit’ from any adverse news or a viral outbreak because it is a decentralized autonomous network that doesn’t have a conscience.

Castle Island Ventures partner Nic Carter added;

“These lunatics gave Craig Wright an audience, that’s how deep their pathological hatred of bitcoin goes, they elevate the industry’s worst fraudsters. Insane”

Bitcoin is doing what Bitcoin has always done. As pointed out by analyst and industry observer @Josh_Rager;

“The coronavirus is almost becoming click-bait for crypto content creators. The short answer- $BTC has made no abnormal price changes during the recent panic waves though stocks in China have taken a significant hit,”

Correlation With Gold

One thing that can, and has been observed though, is Bitcoin’s correlation with gold. This correlation has been evidenced twice this year in two separate incidents.

The tensions in the Middle East sparked rallies for BTC and gold simultaneously and both assets have made sustained moves higher during the Coronavirus outbreak.

bitcoin gold

To say this is ‘good for Bitcoin’ is utterly absurd. What it does show is that the asset has cemented itself among traditional vehicles of investment and its safe-haven narrative has strengthened.

The post No, Coronavirus is Not Good For Bitcoin appeared first on BeInCrypto.

We Use Cookies
By continuing to use our site, you accept our use of cookies