Effect of Coronavirus: 3 reasons why Bitcoin will collapse

The pandemic Coronavirus continues on his way, and apparently there is nothing to stop it. Yesterday the FED decided to lower interest rates in the united States 🇺🇸 to 0%. At the same time, decided to turn on the most of the money printer. Today the markets have reacted with a new fall, like Bitcoin (BTC). What will happen?. Now the point 0 of this deadly disease is in Europe, because in China 🇨🇳 and South Korea 🇰🇷 things seem to be controlling himself. In parallel, the countries of the american continent have decided to close their borders, not only european tourists, but among themselves. Colombia 🇨🇴 2 days ago closed its border with Venezuela 🇻🇪, and yesterday was held under an iron curtain. In addition, it seems that the region has followed the example of the coffee country. No one wants to make the mistakes we made Italy 🇮🇹, France 🇫🇷 and Spain 🇪🇸. They all want to follow the example that he left the situation in China 🇨🇳, at least outside of the city of Wuhan.

Bitcoin (BTC) does not react

Meanwhile, in the crypto market you might think that it has had its worst week since the great fall of 2017. After reaching its maximum of $9.200 at the end of last week, followed by a fall up to $3.800, which represents a fall of over 60% in less than a week. Although it is true that since the first crypto of all has recovered a little. As it has bounced off of $5.600 to $4.400 since then. These two stripes have made many of the holdrs begin to fear a pullback to the $3,000. In part, this is due to BTC since the start of the crisis of the Coronavirus has had a positive correlation with the collapse of the traditional markets. To be informed is not just knowing the positive part of the story, also those negative, which complete the reality so complex that we are going through. Therefore, in CriptoTendencia we will give you 3 reasons that several crypto analysts believe that BTC will touch bottom soon due to the Coronavirus.

Argument 1: The rate of funding of BTC reached the $20k

There are stepping back a little, until last Friday, when Bitcoin is dressed bear for the first time. The first signs of red alert came from the future of the crypto exchange BitMEX, which showed signs of an extensive pressure to the sale of Shorts and Longs.

The rate of “funding” reached briefly the -0,37%. Expressed by the expert in crypto trading SmartContracter.

This means that a large amount of Shorts paid the longs 1% a day to keep the leverage in their positions. After this, the price of BTC on BitMEX fell below the Spot price market. As information today travels at the speed of light, it all fell apart. This index, even though negligible for most, the last time I reached a similar figure was at the peak in the year 2017, just before the collapse of the $20,000. Now it is thanks to the Effect of Coronavirus that affects all of us equally.

Argument Number 2: There is loss of confidence

This week saw a truly massive selling on the part of investors to give Bitcoin, in part perhaps because of the effects that the new pandemic of the Coronavirus. This time there were Big Whales on their own by moving the crypto market. According to the data, were hodls, like you and I, who fled from BTC. In addition, this is evidenced by record levels in 3 years in some of the crypto exchanges most important of all. Price of Bitcoin – Source: Joe McCann. This graph is the market of Bitcoin BTC from Coinbase. It is relevant because this week saw record levels in the volume of transactions. Not seen volumes so sales of BTC from 2017, just after reaching the $20,000. The record level of volume in the exchanges is quite relevant, because peaks are extremely large in the activity of the market is often branded the bottom and the top. Apparently the effect of Coronavirus has affected much more to Bitcoin (BTC) to what they are saying the experts are more positive.

Argument 3: The fundamentals are against BTC

The first criptomoneda of the world remained undervalued for the first time since the bottom reached in the year 2018. But it was not simply for the reason of the argument 2. Given that all of the fundamental indicators of BTC have shown the same thing. Especially the “Daily Users Active” and the “Transaction Value” according to the law of Metcalfe, which is now above the value SPOT of BTC. This has been backed up by Charlie Morris of ByteTree, who on Thursday said that the value of Bitcoin is reasonable, derived from the activity in the chain and how many coins there are, then stood at $ 6.400, well above the current BTC. This represents a loss of confidence of investors, large or small. In addition to a panic future by the effects that the Coronavirus may have, not only in the international markets, also in the very life of all people.

Did you like the content? Share it