Looming Recession And COVID-19 Uncertainties: Why Bitcoin Is Climbing Fast And Why Is It The Right Time To Invest In Cryptocurrencies

COVID-19 has caused economic unrest with a massive recession looming before the entire world. However, one can look at the brighter side of things and examine how it is the right time to invest in cryptocurrencies.

COVID-19 has ravaged the global economy like nothing else has done in the past. Every nation around the globe has been affected by this pandemic. The coronavirus has sent shivers down the spine of almost all the global financial markets. Every state has imposed travel bans and closed down its industries and educational institutions. They are resorting to lockdown and quarantine as the best methods to arrest the spread of the disease. The global economy is staring in the face of an unprecedented recession, on a scale more massive than the 1930’s Great Depression.

Image by Gerd Altmann from Pixabay

Generally, stock’s value goes down during such recessions as investors begin offloading them to gain liquidity. Historically, a cryptocurrency like Bitcoin has a reputation for performing well in such a crisis. Investors view Bitcoin cryptocurrency trading as an avenue to preserve and enhance their wealth. In other words, it serves as a chaos hedge. Let us examine why Bitcoin investment should be ideal during such an economic crisis.

Unwavering Value During Stimulus Measures

Governments everywhere are announcing stimulus packages to kickstart their respective economies. The objective is to inject adequate liquidity into the system. An infusion at such a massive scale can cause the deflation of currencies all around the globe. It automatically enhances the amount of money available.

One of the best investments under such circumstances should be investing money in Bitcoin. Bitcoin can prove perfect for such a situation thanks to the cap on the available number of Bitcoins (approximately 21 million). The finite supply ensures that Bitcoin maintains its value, whereas other currencies lose their purchasing power due to inflation. Thus, Bitcoin could prove to be the ideal account for investment.

Though people believed that cryptocurrency prices too could crash in such floundering economic conditions, statistics prove that these stimulus measures have not had much effect on the Bitcoin pricing.

Upsurge In Bitcoin Usage In The Wake Of Increased Digital Payments

The coronavirus has brought about a sea change in the way people handle currency transactions today. Contactless payments are becoming the order of the day. The World Health Organization advocates the maximum use of digital payments to reduce the spread of the pandemic.

Central banks all over the world suggest quarantining currency notes and coins for a minimum of 14 days before recirculating them. It is because the coronavirus can survive for a considerable period on currency notes. This factor has also pushed many people towards adopting digital payment technology.

Under such circumstances, Bitcoin could prove handy because it advocates a peer-to-peer electronic payment system. Thus, Bitcoin is gaining in popularity by enormous proportions today.

Is It The Right Time For Bitcoin Investment?

The above factors prompt one to seriously consider this as the right time for investing in Bitcoin. However, one has to be aware of the challenges too in cryptocurrency trading. In some instances, Bitcoin can be unsuitable as a payment network because of its inability to scale effectively. Cryptocurrency mining is also a tedious job for many. Another factor is that one needs an adequate number of Bitcoin stock exchanges for active trading. The crypto prices today may also act as a deterrent.

However, one major aspect that works currently in favor of Bitcoin investment is the halving of Bitcoin done on May 11, 2020, that can make cryptocurrency even more valuable and practical in the future.

Final Words

COVID-19 has hit the world badly enough to cause massive economic collapse almost everywhere in the world. With the chances of virtually every currency deflating in value soon, the best investment opportunity lies in cryptocurrencies like Bitcoin. However, it requires people to be aware of how to trade in the cryptocurrency exchange. Nevertheless, multiple factors have increased Bitcoin’s popularity and raised its position on the investment charts as an excellent investment option today.

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