Bitcoin

“Flight to quality” : Bitcoin is a shelter for investors ?

March 25, 2020 by Clementine

At the time of the contamination of the coronavirus begins to alert the financial players in the United States, many investors are interested in BTC and the u.s. dollar to secure their assets. If this phenomenon is commonly referred to as flight to quality or Flight to quality/security ” had been registered recently in 2008 in favour of the dollar, it seems that the advent of BTC is a new safe haven for investors.

Bitcoin and the dollar, raising the interest of investors

The pandemic of sars coronavirus has created a chaos without name on the financial market since the month of January 2020. The regression aggressive in the volume of trade in the world has, in particular, generated the stagnation of activities, followed by a large-scale fall in currency prices.
In the Face of this kind of situation, investors resort to a security quick of their holdings by selling their securities to flee toward assets with low sensitivity to the discount. For this purpose, Google Trends reported that search on the words “Bitcoin” and “u.s. Dollar” these past few weeks have increased, suggesting a phenomenon of flight to quality during this period of crisis.

The economic collapse will benefit the Bitcoin

Bitcoin is considered an asset class independent of the global economic order, in the sense that its value is weakly correlated with the financial indicators as usual. Note that the BTC has been able to reach 20 000 by 2017 before collapsing to less than $ 3000 in 2018, and this, without a particular impact with the stock market traditional.
In this perspective, Bitcoin is an asset of a different kind, which could certainly stir up the confidence of investors in the context of an economic crisis total.

Philip Salter, head at Genesis Mining ” the interest in Bitcoin will explode. It will once again become a hedge against the banking system. The more people who have skepticism in the old economy, the more they will flock to Bitcoin ” .

What do you think of this appeal of Bitcoin and the us dollar among investors in this period of crisis ? Give your opinion in the comments section.
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Passionate about the universe geek, Clementine finds the news more interesting and involved in their drafting. The latest articles by Clementine (see all)

About the author

Jeremiah Faber

Jeremiah Faber

Jeremiah is an explorer by heart – both in the physical and the digital realm. A traveler, Jeremiah continues to visit new places throughout the year in the physical world, while in the digital realm has been instrumental in a number of Kickstarter projects. Technology attracts Jeremiah and through his business acumen has gained financial profits as well as fame in his business niche.