The main cryptocurrency recovered the price it had before the fall of traditional markets in mid–March.
According to CoinMarketCap metric data, the price of Bitcoin has reached levels before the market crash that the Covid-19 pandemic caused. The price that Bitcoin registered on April 26th, which was close to about USD 7,641, is around the price it had before the market collapsed in mid-March.
On April 28th the price of Bitcoin was USD 7,741.33, showing an increase of about USD 100 in only two days. If this price is maintained, in just over a month Bitcoin would have successfully survived the worst drop in the world market in several years. However, the Covid-19 pandemic is not yet over and the future is not yet certain.
The halving is just a few days away. This is an event that would help to increase the demand of bitcoins since the halving reduces from 12.5 to 6.25 the reward of new BTC in each block mined. This reduction could help increase the price of the main cryptocurrency. However, it could also happen that the price does not change very much.
Bitcoin has been promoted as an independent digital currency that does not follow traditional markets. But, last month, Bitcoin did exactly the opposite. On March 12th, the main crypto asset followed the traditional markets and collapsed.
Thus, more than a month and a half ago, the price of Bitcoin fell from around USD 9,100 to USD 7,650. This is the lowest level the digital asset has reached since March 2019, when its price fell to USD 4,107.
The BTC Recovery
Bitcoin’s price started to rise after global markets and major economies began to emerge. In this way, and since then, the crypto market has been recovering.
Regarding having a possible economic collapse, investment and securities banking group Goldman Sachs said, last Monday, that “The Federal Reserve (FED) and Congress-ruled out the possibility of a complete economic collapse. Investors have been motivated by the ‘do everything that needs to be done’ approach from the FED”.
Besides, to stimulate the economy, the FED injected almost USD 5 trillion into the struggling money markets, since the financial entity has also lowered its interest rates to levels close to zero.
There was already a sustained recovery in the price of Bitcoin during the week of April 20th. With this, the price of the main altcoins also recovered. The price of Bitcoin was stable Saturday and Sunday of that week.
Previous weeks, the price of the first cryptocurrency plummeted along with the closing of the stock market. Now, a few weeks before the halving, it is uncertain whether the price of BTC will remain or not, as well as it is not known what will happen globally or how the situation will progress with the Covid-19.
However, those who believe in and defend the crypto-asset as a haven or as a way to save money could argue that they saw this issue coming at all times.
Meanwhile, in countries like Argentina, Venezuela, and even the US, the purchase of bitcoins continues and even increased a little. Brian Armstrong, CEO of Coinbase, recently explained on Twitter that, during the last week, there was a spontaneous growth in the purchase of BTC on this platform.
The increase was evident with deposits of up to USD 1,200, the amount corresponding to the subsidy that the US government has been providing for unemployed citizens to face preventive quarantine times. Buying cryptocurrencies would be how citizens seek to preserve their money. It is the way to give Bitcoin more adoption.
By María Rodríguez
