Coronavirus Pandemic Leaves Global Markets in Turmoil, Crypto Markets Fail to Deliver As Well
The Coronavirus outbreak which initiated from the Wuhan City of China has left the global markets in turmoil while raising concerns about a global economic recession. Last week, South Korean, Italy, and the United States raised concerns about rising Coronavirus cases and reaching alarming levels.
This has got the market to tailspin downwards further. In just four days, all three indices - Down Jones, S&P 500, and Nasdaq - corrected almost around 10%. This has been the fastest 10% correction in the market after the 2008 market collapse.
However, all eyes have been on the cryptocurrency markets as traditional markets were plunging. More often, digital currencies and crypto markets are considered as a substitute to the traditional markets and thus both are ideally expected to react inversely with respect to the other.
But just when the world saw mayhem in the traditional stock markets last week, the crypto market left us disappointed with a poor show. In fact, the cryptocurrency market has also lost over 15% over the last week.
The overall cryptocurrency market cap is down by $50 billion in the last seven days. Similarly, the Bitcoin price has crashed 15% all the way from above $9900 to now below $8500. Not only Bitcoin, but the largest altcoin by market cap Ethereum (ETH) has also lost over 15% in the last week.
It is a similar story all across the cryptocurrency market. This clearly shows that the crypto markets have failed to pick up at a time when the traditional markets have been bleeding badly.
Besides, the Coronavirus spread has also delayed China’s Digital Yuan research as per a report by Global Times. As per an unknown source, the spread of the epidemic has resulted in significant setbacks.
As per Shentu Qingchun, the CEO of Shenzhen-based blockchain company BankLedger, the central bank was expected to make an important announcement during Q1 2020. But recently the source has confirmed that: “The coronavirus outbreak has led to postponed work resumption in government institutions, including the People's Bank of China. Policymakers and research staff involved in the DCEP [Digital Currency Electronic Payment] project are no exception, which weighs on the development process.”