How COVID-19 is opening new doors for crypto and blockchain
The outbreak of COVID-19 has created widespread uncertainty and volatility within the global economy, causing everyone from local to national levels to experience never-before-seen circumstances.
Let’s explore some examples of how the outbreak of COVID-19 has impacted cryptocurrency and blockchain.
A growing interest in bitcoin
While there have been numerous negative effects of the coronavirus, this has not entirely been the case for the crypto markets.
In recent weeks, we have seen all-time highs in bitcoin trading volume in several different countries, including – which has also resulted in a spike in hiring among crypto-based businesses in order to keep up with demand.
But why has the demand increased so much?
A great portion of this record-breaking volume took place on March 12 (which is also becoming known as Black Thursday) when bitcoin’s price fell by almost 50% and triggered the largest degree of inflows in the asset’s history. As prices plummeted and the potential a globally ready digital asset could have amid the virus became clear, traders started moving at an incredible level.
The deflationary nature of bitcoin is also a key draw, as we are expected to see unprecedented levels of money printing this year put even greater pressure on the U.S. dollar.
A shift toward stablecoins
But bitcoin isn’t the only form of crypto to experience new life as a result of COVID-19.
Stablecoins have also seen a rise in trading volume the past couple months, likely due to their ability to shield investors from high volatility and to provide near-USD-equivalent exposure. In fact, the market cap of all stablecoins has risen from $5 billion at the start of the year to over $10 billion as of May 22.
As the pandemic highlights the need to be able to transact from anywhere in the world at any time, the potential for stablecoins to offer an unbroken, liquid source of funds for organizations has made itself ever-apparent.
Moving blockchain forward
The virus has exposed glaring inefficiencies on a worldwide scale in several key areas, including supply chains, data management, and resource deployment. These inefficiencies coming to light has accelerated the widespread use of blockchain, as well as the notion of universal adoption among governments and enterprises alike.
It has become evident that this technology can be leveraged to improve our global infrastructure – improving transaction speed, transparency, and accountability – emphasizing that we need to continue the development efforts.
Perhaps the greatest example of this adoption is the blockchain-based open data hub MiPasa, which global organizations ranging from the WHO to IBM and Microsoft have partnered to begin building.
The platform aims to quickly and precisely detect coronavirus carriers and high-infection areas across the globe, then securely share information among hospitals and authorities to aid in the analysis of public health.
The combination of instant information sharing and privacy protection are helping make MiPasa an invaluable tool in fighting the spread of COVID-19. This is just one example of many applications ranging from startups to global organizations finding new ways to use blockchain in the wake of the pandemic.
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As the needs of the day continue to open new doors for the worlds of blockchain and cryptocurrency, now is the time to get involved and invest in the future of these cutting-edge industries.
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