The coronavirus crisis has seen Bitcoin price nosedive in one of the greatest Bitcoin price crashes since its inception. With a 52% drop in price in a single week, the coronavirus has left many Bitcoin enthusiasts scratching their heads. Even the legendary crypto trader, Peter Brandt, who predicted Bitcoin’s peak way back in 2017, tweeted that he wouldn’t be shocked if it crashed to $1,000 and below.
Will Bitcoin recover from such a huge crash? And can it still be trusted to store value over time? These are just some of the questions that people are seeking to answer, and the uncertainly over the answers is part of the reason behind the huge sell-off. But before judging Bitcoin too harshly, it is worth noting that even fiat markets have crashed thanks to the coronavirus mayhem. In fact, equity markets have seen their worst crash since 2008.
Here are some logical reasons why Bitcoin is crashing:
People Prefer Holding Cash When in Crisis
The huge sell-off in both equities and cryptocurrency can be explained by the notion that cash is king. When people panic, they quickly resort to hoarding cash due to fear that the prices of their investments will nosedive. Investors are taking back their money with the intention of buying back into the market at the bottom, while the rest of us are just responding to fear and uncertainty. Additionally, Bitcoin is yet to be fully accepted as a mode of payment, and people want to have enough paper money to buy food and medicine just in case the crisis worsens by the day.
Non-Hodlers
Late adopters of Bitcoin and cryptocurrencies may not appreciate the value of hodling their Bitcoin amidst the swings in the market. Analysts believe
