For more than a month now, a large number of countries have been living under foreclosures and house arrest orders due to the coronavirus epidemic. Meanwhile, central banks like the Fed, the Bank of England (BoE) and the European Central Bank (ECB) have channeled trillions of dollars into the hands of private financial operators. Despite the market carnage on March 12, the cryptocurrency markets have gone against the grain and remain resilient. Bitcoin and digital currency trading volumes in the first quarter (Q1) of 2020 exceeded Q1 2019 volumes by 61%.
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Lockdowns and Stimulus Fuels Crypto Trade Volumes
Fear of coronaviruses has ravaged the global economy by affecting every continent on the planet. The covid-19 virus can cause serious illness and even death because it has pushed nation state politicians to shut down the economy. Bureaucrats have forced citizens to stay at home with specific foreclosure warrants. Bureaucratic leaders have also shut down large industries, including services like hotels, restaurants, airlines, cruises, etc. Essentially, depending on your jurisdiction, an on-site shelter order means that residents are asked to stay at home and not to leave their residence to travel, except in emergencies.
All of these actions collapsed the stock market, the housing markets were shaking, and oil fell below $ 20 a barrel of crude. Like the bitcoin and cryptocurrency markets on March 12 “Black Thursday”, gold took a big hit and fell to a low of $ 1,579 per Troy ounce. Since then, gold has gained 5.3% in value to date, as one ounce of fine gold retails for $ 1,661 at press time. The BTC fell to a low of $ 3,800 on March 12, but prices have since gained 90.78% in value. Even though the global economy has stumbled, digital assets have far outperformed the equity and precious metals markets.
First quarter crypto trade volume 61% higher than 2019 – Bitcoin derivative volumes soar
Trade said “Black Thursday” had a record global trade volume of $ 70 billion, as trading platforms were swamped with both buyers and sellers. Bitcoin options soared to a record $ 198 million that day, as well as crypto derivatives, especially options and futures, had a historic month. The Chicago Mercantile Exchange (CME) traded for $ 347 million in bitcoin futures on April 2. In addition, the Bitmex derivatives market has lost its dominance compared to other futures market players like Okex, Huobi and Binance.
Steven Zheng of The Block reviewed the volumes of 22 major crypto exchanges and discovered a significant spike in the first quarter of 2020 compared to the first quarter of 2019. Zheng’s statistics indicate that the trading volumes reached over $ 154 billion in Q1 2020, an increase of 61% compared to Q1 2019. Despite the increase in volumes, some analysts thought that the cryptography trade volumes must continue to increase or unfavorable trends will crush optimism.
Digital currency trading sees 1000% increase in crypto trading activity – 90% of buyers
There has also been an influx of peer-to-peer (P2P) trading volumes in some countries on platforms such as Local.bitcoin.com, Paxful, Mycrypto, Hodlhodl and Localbitcoins. Regions that see much more P2P trade volume in countries like Argentina, Chile, Colombia, Egypt, India, Kazakhstan, Kenya, Mexico, Morocco, South Africa, Sweden, Tanzania and Venezuela. In addition, the San Francisco Coinbase Stock Exchange had its best month of trading volumes in March. Blockchain analyst Chainalysis recently noted that trading volumes in mid-March were 9 times higher than the usual daily average.
At the end of March, the London fintech cryptocurrency application, Mode Banking, saw its transaction volume increase by 1,000%. Mode detailed that the week after the UK was put under official lockdown, the Mode app saw a massive spike in crypto trading activity. 90% of transactions were buyers and most Mode users are from the UK. Mode Banking attributes massive purchases of crypto to the coronavirus and stimulus packages routed to private banks.
“The impact of aid programs on coronaviruses and monetary stimulus programs,” Mode wrote on April 9. “Billions of dollars have been injected into economies and stock markets around the world. This has caused longer-term concerns about the deterioration of the US dollar and other currencies, and rising inflation. Fashion further said:
The nature of Bitcoin means that quantitative easing and other monetary measures do not directly affect its price and therefore it can be used to protect against the impact of it on fiat currencies.
Digital currency markets go against the grain
At the time of publication, the crypto economy is hovering around the $ 210 billion area and there are currently around $ 25 billion in global crypto transactions. Most of the first 20 coins are relatively stable, but cryptos like tezos, bitcoinsv, chainlink and bitcoin gold saw decent gains on Thursday. A number of lesser-known digital assets work well like bora, ethlend, acute angle cloud, hdac and swftcoin. Overall, traders and enthusiasts are positive about the behavior of the market during all closings and stimulus injections.
In addition, people will see even more inflation when countries like Spain, Canada and the United States throw money from the helicopter to citizens. Secretary of the Treasury Steve Mnuchin told US House of Representatives politicians on Wednesday that about 60 million Americans will receive their stimulus checks next week if they use the IRS direct deposit system. However, Mnuchin recently admitted that those who did not register for direct deposit would not receive a check until the end of August.
What do you think about the prices and volumes of counter-current cryptography? Let us know in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons, Skew, Mode Banking, Goldprice.org
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