The COVID 19 pandemic was a challenge for everyone, but it opened up many opportunities for us in the blockchain industry. Sales are declining in most industries as bankruptcies and layoffs determine the day. However, cryptocurrency and blockchain companies have expanded and added and applied for new licenses.
The pandemic has caused suffering in this industry as in others, but the fundamentals of crypto are better than those of traditional financial markets. We’ll experience some changes, however The cryptocurrency and blockchain industry is strengthened by this crisis. The participants of the new market They are looking for derivatives and margin products and are increasingly trying to trade on their cell phones and mobile applications.
A second wave
The next wave of COVID-19 would take advantage of underdeveloped startups. That’s why Sustainability is very important. There will be a crash test soon not just for crypto players, but for everyone. However, These efficient companies will remain and the industry can be strengthened.
Traditional investors fear that a second wave will upset the traditional market again. March, The price of Bitcoin (BTC) dropped to around USD 3,000 and quickly recovered to over $ 9,000, even achieved short $ 10,000. By regaining pre-pandemic levels, We see Bitcoin recovering much faster than other financial investments. I assume the prices of cryptocurrencies will collapse and bounce off quickly in the event of a second wave of COVID-19.
The crypto space will continue to grow despite a global economic downturn, although many are still suffering from COVID-19 and the effects of the quarantine. In one The global economic downturn, individuals and institutions have turned away from traditional assets and looked for opportunities for cryptocurrencies.
Traditional and institutional will be more aggressive on cryptocurrencies
So, Traditional investors will continue to turn to crypto assets, particularly family offices and asset management companies. The market alone It will mature, especially IPOs, decentralized finance and traditional financial markets. We see that traditional investors They become more aggressive when they invest in this room. as well as They build incubators for blockchain projects.
Multinational companies and even banks have established new investment weapons for blockchain technology and cryptocurrency. looking to diversify into these alternative assets. According to a recent Fidelity survey 80% of institutional investors found digital assets attractive, while 60% of them viewed Bitcoin proactively as part of their regular portfolio investment.
In the overview, 74% of institutional investors in the United States and 82% of European investors found cryptocurrencies attractive. Meanwhile, 36% of institutional respondents were attracted to cryptocurrencies because “they don’t correlate with other asset classes”. and the 34% were attracted to the innovative strength of the technology. And 33% liked the high bullish potential.
Tom Jessop, President of Fidelity Digital Assets, commented the survey as follows: “These results confirm a trend that we see in the market to increase the interest and acceptance of digital assets as a new class of investable assets.” He added:
“This is reflected in the evolving composition of our customer base, which ranges from crypto funds to bonds.”
Working from home is an opportunity for the crypto space
Moving physical and commercial offline activities to an online setup for cryptocurrency and blockchain launches. From now on we’ll see Discussions and debates about investing in cryptocurrencies from billionaires and traditional investors. Whether they admit it or not You will closely monitor blockchain technology.
In the “new normal”, blockchain technology can be applied to the Internet of Things. medical systems, supply chains and can be used for transparency in financial markets, charities and non-governmental organizations. By doing Asian countries, for example, Little is known about how NGOs spend their money and how many intermediaries participate.
Sometimes, Only 10% of a donation goes to those who really need it. When this process is placed on a blockchain, everything is chained and transparent. There is no black box and we can track donations to make sure they get where they were originally intended. After this Companies that use blockchain technology for these purposes will only then begin to discuss tokenization.
For now, to be sure Most attention remains on Bitcoin. In a world after COVID-19, portfolio diversification will become increasingly important, especially for asset management companies and banks. COVID-19 therefore offers cryptocurrencies the opportunity to open up new markets, work with large banks and attract large investors.
The views, thoughts and opinions expressed here are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.