With the current outbreak and cities on lockdowns, the world economy is on a downward spiral. Billions of dollars have been invested in an attempt to get out of this financial struggle. Some governments are undoing the trade barriers, while others are easing the restrictions.  Regardless of the limitations, the pandemic continuous to ravage both rich and poor countries. In the United States, more than 3.28 million people have been fired, resulting in the biggest unemployment rate in the country’s history.  Despite the whole world collapsing, one currency has managed to go higher and higher – cryptocurrency. The market is on fire with bitcoin prices going far over $7,000. Here is why.

Search Engine Interest in Altcoins Escalates

Crypto and blockchain are known for their bizarre market dynamics. Since March, the Bitcoin price dropped every day by almost 50% due to the sudden dive in oil prices, stated the CNBC.  For anyone in the bitcoin mining business, this seemed like the end of crypto as well. It’s no wonder why. When a valuable asset drops in value by almost 50% that could send chills down your spine. Some individuals may have translated that into low interest, not worth to get mined. But, that couldn’t be more wrong.  The global demand for crypto is quickly increasing, published the Cryptopolitan. The demand for altcoins, such as bitcoin and crypto, is increasing at a rapid rate. Based on statistical analysis shared by Yassine Elmandjra, an expert cryptocurrency analyst, the interest in these altcoins is almost at the highest peak all across Africa and South America.  Plus, the biggest crypto exchange in the U.S., Kraken, have boosted their workforce by 10%. That means, more job openings have recently been available in the field, announced Forbes in March. With 800 employees, the exchange decided to add 67 new hires to the team.  Also, Ethereum is looking strong. The average cost basis rose sharply by 3.6% in February 2020. A similar moment was noticed with the mining difficulty increasing by 3.7%. This is a clear indication the network is in good health.  But, that’s not all. The currency is being widely distributed, which means the increased distribution supply is a good sign of rising interest rates in other market participants. Even though these tokens are getting distributed by crowdsale, more and more hands have access to it.  Since February this year, the addresses held supply hold around 40% of the entire Ether supply. The percentage might look small, but it’s slowly rising. By the end of February, some addresses worth increased by 8%, which is a clear indicator that the volume is on the rise.  However, this didn’t happen overnight. The interest in crypto has been steadily rising in the last couple of days. Despite the massive March plunge, it didn’t discourage investors. From what we can tell from the results, it seems that the impact is on a global scale. In fact, in the last couple of weeks, stable companies have mined countless dollars in digital currency. 

What Could Be the Cause for the Increased Demand in Crypto?

There aren’t any statistics that pinpoint the exact cause for the high demand, but there are a couple of speculations as to what could be influencing the quickened interest in cryptocurrency. One of them starts with the central banks.  To calm down the social unrest from the COVID-19 pandemic, central banks have been printing more money than we can imagine. To curb the recession, banks and governments have turned to additional emergency measures, some of which include giving away cash to citizens, transferring millions of dollars into bonds, or anything else that would keep the global economy from sinking in. While at the same time, bitcoin halving is drawing closer. As a result, the altcoins currency (bitcoins, crypto, etc) will be getting a shorter supply. These two factors could be the key reason for the sudden increase in crypto value. Eventually, we will end up with a supply-demand curve that will immensely pay off in the crypto value growth.  

Could This Be a Classic Disbelief Case?

According to News BTC, many crypto analysts say that investors are afraid this might be another classic disbelief phase and not good enough for a sustainable digital asset long-term recovery.  Experts have long been debating about the crypto market cycle. It’s normal for all financial markets, including the digital economy to go through periods of ups and downs, with trends increasing and declining over time.  Depending on the cycle, investors decide their next strategic step. For example, when crypto is at the highest peak, investors tend to make irrational decisions and have huge expectations for the market to keep growing. The same thing happens when the market is at an all-time low.  But, the disbelief could be leaving investors behind. Since crypto has managed to pick up positive momentum, it’s not a good idea to ignore the uptrend. With the coronavirus, many are left with shaken legs, unsure of whether or not to back up an asset. Yet, ignoring the signs could be a major drawback.  The rest of the cryptocurrency market, including bitcoin, has almost doubled. Compared to the Mid-march setback, it’s expected that some investors may not be willing to take a step.  https://www.youtube.com/watch?v=kubGCSj5y3k

What About the Future?

Regardless of the current global recession, the blockchain industry is looking positive. Experts believe the crypto market is on the right path, even for the next year. For anyone in the mining business, particularly in the Chinese blockchain industry, this could be the best time. There are two possible reasons for that.  First, China including its neighboring countries has managed to tame the pandemic. They’ve already established adequate control measures. The second reason is monetary policies. Many countries all around the globe have already adopted new rules that will ease monetary policies.  In the last couple of years, bitcoins have been considered the digital gold, a “safe haven” for focusing investments and assets, particularly for markets under extreme pressure. The pandemic has provided that pressure. Even though the bitcoin is nowhere near the rate it was at the beginning of the year, it seems that the interest in crypto is showing future promise.  According to Cryptoslate, Basic Attention Token (BAT) is currently seeing the highest growth patterns in the altcoin industry. There were more than 2,600 addresses created for this exact cryptocurrency. Despite the fact that around 89% of the BAT address holders are losing cash, the massive interest in addresses for the network indicates that a huge chunk of the holders will eventually be in the green. This is one of the most reliable precursors for the future of cryptocurrency. But, when it comes to long-term assessment, it’s too early to tell. The network can skyrocket and plummet as it did a while ago. But, as it currently is, the cryptocurrency is showing plenty of potentials.