The COVID-19 pandemic has been a challenge for all of us, but it has created many opportunities in the blockchain industry. In most industries, sales vectors are declining as bankruptcies and layoffs rule the day. But companies in the crypto and blockchain space have expanded, hiring and applying for new licenses.
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The pandemic has caused suffering in this industry, as in others, but the fundamentals of cryptography are better than those of traditional financial markets. We will experience some changes, but the crypto-currency industry and the chain of blocks will be strengthened by this crisis. Participants in the new market are looking for derivatives and margin products, and increasingly they are looking to trade on their mobile phones and applications.
A second wave
The next wave of COVID-19 would gut new underdeveloped companies. That’s why sustainability is so important. Soon, there will be a crash test not only for the players in the crypts, but, for everyone. However, those efficient companies will persist and the industry can be strengthened by it.
Traditional investors fear that a second wave will plunge the traditional market back into turmoil. In March, the price of Bitcoin (BTC) fell to approximately USD 3,000 and quickly recovered to over USD 9,000, even briefly reaching USD 10,000. I anticipate that the prices of cryptosystems will collapse and bounce back quickly in the event of a second wave of COVID-19.
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Crypto space will continue to grow despite a global economic downturn, although many still suffer from VOC-19 and the effects of quarantine. In a global economic downturn, individuals and institutions have been moving away from traditional assets and looking for opportunities in cryptosystems.
Traditional and institutional will be more aggressive about cryptomonies
Therefore, traditional investors will continue to use cryptoactives, especially family offices and asset management companies. The market will only mature, particularly the initial exchange offers, decentralised finance and traditional financial markets. We see traditional investors becoming more aggressive when investing in this space, as well as building incubators for blockchain projects.
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Multinational companies and even banks have established new investment weapons for blockchain technology and crypto-currency, seeking to diversify into these alternative assets. According to a recent survey by Fidelity, 80% of institutional investors found digital assets attractive, while 60% of them have been proactively looking at The News Spy as part of their regular portfolio investment.
In the survey, 74% of US institutional investors and 82% of European investors found crypto currencies attractive. Meanwhile, 36% of institutional respondents were attracted to crypto currencies because they are ’not correlated with other asset classes‘, and 34% were attracted by the innovative nature of the technology. And 33% liked the high upside potential.