UNITED STATES (OBSERVATORY NEWS) — Fears related to the coronavirus positively impact the cryptocurrency stock markets: the price of bitcoin soared until reaching 9,300 dollars during this week in which more than 300 people died because of the epidemic.
Bitcoin prices have skyrocketed as fears about the coronavirus epidemic spill over into global stock markets. This has lead people to use services similar to the British Bitcoin Profit in order to maximize their chances of obtaining a windfall during the pandemic.
Bitcoin (XBT) now sells for around 9,300 U.S. dollars. Its price has increased by almost 10% this week and has gained 30% since the end of 2019. It is its best start of the year since 2012.
So it doesn’t come as a surprise to learn that many people are now deciding to diversify their portfolios by investing in specific types of cryptocurrency like Bitcoin to make more money.
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Concerns about the rapid spread of the coronavirus are one factor that stimulates its flight, but not the only one.
“The recent surge in bitcoin can be attributed to current economic uncertainties,” Shaun Djie, CEO of digital token company Digix, told CNN.
The official cited lingering concerns over US-China trade relations, Brexit concerns, and political tensions between Japan and South Korea as factors that pushed up bitcoin prices. However, the coronavirus remains, in recent times, the most major cause of this phenomenon, said Mr. Djie.
In the same vein, the latest peak in bitcoin is similar to the gold race : the yellow metal also jumped this month and is now trading at its highest level in seven years.
“Gold and bitcoin are on the rise as investors seem unconvinced of last year’s stock market rally,” said State Street strategist Marija Veitmane.
She added that bitcoin, as well as gold, benefits from the fact that interest rates are low (or in some cases, negative) following cuts by the Federal Reserve and many other central banks last year. This has caused the US dollar to fall against other currencies in recent months.
Wall Street embraces the rise of cryptocurrencies
Investing in bitcoin has become more common thanks to the initiatives of big tech companies like Square and Facebook, writes CNN.
“The support from Square and Facebook is certainly very important to the global crypto industry as it validates distributed technologies and all digital assets and cryptocurrency space,” said Mr. Djie. “The adoption of cryptography by these companies can allow mainstream users to take advantage of the versatility and agility of the technology.”
A weaker dollar is good for bitcoin
Bitcoin, gold and other cryptocurrencies and precious metals have historically worked well when investors bet that the value of major currencies supported by the government will fall.
“There is a new consensus on the weakness of the dollar,” said Veitmane. “Bitcoin and gold could continue to be successful as safe investments.”
Outbreak of the epidemic
An outbreak of the new coronavirus (2019-nCoV) was recorded in Wuhan at the end of December 2019. The number of deaths has risen to 304 people, according to the latest report from the Chinese health authorities. The first death outside of China has been reported in the Philippines. The number of infected has exceeded 14,000 in China, and 150 cases have been recorded in other countries. In France, six cases are still confirmed since January 30.
This article is written and prepared by our foreign editors writing for OBSERVATORY NEWS from different countries around the world – material edited and published by OBSERVATORY staff in our newsroom.
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