Bitcoin experienced its worst plunge in March, will the cryptocurrency bubble burst?

According to Bloomberg News, the new crown virus pandemic casts a heavy shadow on the global economy, investors have sold high-risk assets, financial market turmoil has severely damaged Bitcoin, and March was the worst month for cryptocurrencies ever. One.

Bitcoin fell more than 27% on March 12th, the largest one-day drop in nearly seven years. The average daily fluctuation in March was 5.8%. In contrast, the price of gold, traditionally considered a safe-haven currency, fluctuated by 1.6%.

The defeat of Bitcoin negates the claim that Bitcoin was a safe haven during the turbulent times. With stocks and precious metals plummeting at rates not seen in decades, digital currencies have been forced to liquidate as people scramble to cash out all assets.

• Market analysis: The resistance above BTC is large, waiting patiently for admission
• Asia has set off a boom in virtual banking, and native banks have broken the cocoon in the digital currency era
• Coinbase CEO: Almost every economic field is struggling, and Bitcoin is the currency people need at this moment

Craig Erlam, senior market analyst at Oanda, said: "Bitcoin is a highly speculative tool, so in this risk-averse market, it naturally bears the brunt. If Bitcoin is held as part of an investment portfolio, then it is in The proportion of positions closed to cover margin calls or losses is also high. "

Some analysts predict that the new crown virus crisis may lead the US economy to a recession, which can be comparable to the worst recession in modern history. The spread of the virus will also bring the global economy into a long-term recession, and many economists have lost hope for a strong rebound.

Other tokens have also been hit this month, with Litecoin down about 35% and XRP down 25%. Ethereum is one of the hardest hit areas, with a drop of more than 40%. In this environment, many digital token enthusiasts have changed their view that cryptocurrencies can serve as a safe haven in times of market turmoil.

Quanti Economics founder Mati Greenspan wrote in a report: "The fluctuations are mainly because the history of digital tokens is not deep enough and the adoption rate is not stable, which has led to a lot of speculation. For me, measuring success The standard is that Bitcoin keeps a slow but steady upward trend, not a spike in prices due to global uncertainty. "

Bitcoin rose before the last halving (2016), and this experience has stimulated optimism among some cryptocurrency enthusiasts. They look forward to the halving of Bitcoin in May.

Matthew Dibb, co-founder and chief operating officer of Asian institution digital asset platform Stack, said: "The recent global recession is the result of the Black Swan incident, but we believe these negative factors are temporary. The halving of Bitcoin on May 13th will reduce Provide another catalyst for its rise to $ 15,000 by 2021. "

Olam senior analyst Erlam said that the turbulent market environment offers opportunities for Bitcoin, but it must prove its value in the current environment.

Image credit: Pixabay

Author: May

This article is from bitpush.news. Please reprint the source.

We will continue to update Blocking; if you have any questions or suggestions, please contact us!