Under the crisis of COVID-19, concerns about the collapse of the financial system have swept the world. Many cities have been blocked for several weeks now. After the blockade, many businesses closed and stores closed. In the United States alone, the number of unemployed people increased to 6.6 million (some statistics say it has exceeded 10 million).
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- U.S. Federal Reserve cuts interest rates sharply
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The global economy seems to be about to collapse. Is it time for Bitcoin to begin to show its strength and prove its ability? Dan Morehead, co-founder and CEO of Pantera Capital, thinks: Yes.
In the latest WhatBitcoinDid podcast, Morehead said,
"This will be an important moment to prove the functionality of Bitcoin. Bitcoin was born in the financial crisis and it will come true in this era. I really believe this is true. Satoshi Nakamoto created Bitcoin as a last time In response to the financial crisis, bitcoin ’s use cases will really shine at this time. There are now many businesses that are freezing and not functioning, and bitcoin is still working well. ”
Morehead, a senior investor, continued,
"In this era, paper money is the least scarce thing on earth. The number of paper money is reaching an unprecedented height, so its value will not rise. As a consumer product, you can make a lot of it, which will not increase its value. But scarce assets will. Therefore, gold has been an important value storage tool for more than 5000 years, and it will not suddenly disappear tomorrow. I think that bitcoin is better than gold, but they are similar. "
As the market fell, gold, the traditional store of value, and Bitcoin witnessed the rise in the correlation between the two. In March, bitcoin's spot transactions dominated the transaction volume data. The steady price increase in the last two weeks was mainly due to the increase in spot volume and demand.
Most importantly, as prices fluctuate towards the positive side, optimism among institutional participants has recovered. At the end of March, one can notice an increase in the trading activity of BTC futures, which basically illustrates the positive trading sentiment among traders.