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Bitcoin Dips Below $9,000 Amidst Coronavirus Outbreak

Please note we are not financial advisors nor are we even remotely qualified to give any sort of financial advice. Anything that can be interpreted as financial advice should be taken with a grain of salt. 

Bitcoin has seen a significant drop in value in the past few weeks in light of the recent outbreak of the Coronavirus. February of 2020 proved to be a relatively stable month for Bitcoin with its value staying steadily above $9,000. However, its steady decline started around mid-February, when it hit a peak of around $10,500. It then dropped almost 18% throughout the latter half of February, hitting a bottom of around $8,500 at the beginning of March. Since the writing of this article, Bitcoin (BTC) is valued at around $8,800. While there is not any solid evidence that the recent news of the COVID-19 outbreak has had any impact on the market, it is speculated by many in the industry that there may be some correlation between the two events.

Coronavirus Fears Spark Panic Selling in Crypto & Traditional Markets

To float the idea that virus outbreak has had any affect on crypto, let’s compare it to a more traditional market. The S&P 500 is usually a good start. Similar to Bitcoin, the stock market index hit an all time high in mid-February. An 8.5% drop soon followed throughout the end of February. The drop in price can be the result of a variety of different factors.

The panic selling could be a result of the disruption of business of many companies due to many of their supply-chains being located in China. The cancellation of travel plans and many major events worldwide has also played a part. However, many experts also suggest that US stocks were about ready for a drop, virus or no virus. Regardless, a drop in both traditional and cryptocurrency markets can be looked at in a positive light.

Updated on March 16, 2020

With the rewards of Bitcoin expected to be halved in May of 2020, no one expected that the overall value of Bitcoin (BTC) would also be almost cut in half. The price of Bitcoin fell over 40% last week, dipping below $4,000. The US stock exchange, along with other financial communities around the world, also experienced some turbulence caused by the worldwide cancellations of many events and business closures.

There have also been reports of delayed Bitcoin and other crypto transaction times. This is most likely due to many of the nodes being located in China. Also, the massive selloff of crypto as a result of novel Coronavirus (COVID-19) has most likely clogged up the network.

Buy Low, Sell High

The similarities between the price fluctuations in both markets is a great sign of maturity for cryptocurrency. Bitcoin’s historic price volatility has often served as a deterrence for newcomers. Seeing both markets working in similar ways further proves that cryptocurrency is slowly making its way into the mainstream. The age old saying of “buy low, sell high” can work for both. 

While many have sold their stocks in fear of a price drop, many have also started investing while the prices are low. Since crypto is becoming more mainstream, international investors are now applying their knowledge of traditional stocks to their crypto assets. Historically speaking, pandemics of this type that result in panic selling often come and go. The stock market usually corrects itself after the panic dies down. If the correlation between both markets continue on this shared path, then this may indicate that cryptocurrency will also, hopefully, bounce back after the news dies down. Some financial analysts have even reported that it may be a good time to take advantage of low stock prices. It would be great if the same could be said about crypto. 

Stay Safe, Not Matter What

We cannot say for sure when and if the price of Bitcoin will start rising again. However, we can say for certain that if you do plan to start investing that you should always store your crypto in cold storage. Fluctuations in the marketplace, pandemics, and panics are things that are out of our control. How we choose to secure our assets is something we can control and a hardware wallet is the best option. Whether or not the recent virus outbreak has had any impact on Bitcoin, it is important to keep both your and your assets secure. Stay safe out there, friends. 

Again, please note that this is a speculation article and does not reflect the views of CoolWallet S or CoolBitX. We are not financial advisors nor are we even remotely qualified to give any sort of financial advice.

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