The value of the well-known cryptocurrency fell far on Thursday (March 12) as traders sold off assets, fearing the worst.
Economic damage from the coronavirus, which has now been classified as a global pandemic and has sent world’s economies into flux as people stop working and shutter themselves in their homes, can’t fully be quantified yet, according to analysts.
Bitcoin saw its value decline around 25 percent on morning trading, although it was able to eke out small gains later on. It has lost around 30 percent of its value over the last week. The last numbers had it down 22 percent at $6,206, its biggest daily loss in years.
Jamie Farquhar, portfolio manager at NKB, a London-based crypto firm, told Reuters that bitcoin’s losses are simply in unison with the others across the spectrum of trades seeing a slump right now.
“We’ve seen de-risking across all asset markets,” Farquhar said, according to Reuters. “Bitcoin is certainly not immune to that.”
The disease that the coronavirus causes, COVID-19, is highly-infectious, and there’s still no way cure it. U.S. President Donald Trump this week banned travel from Europe in an attempt to contain the virus.
Many people still doubt bitcoin’s ability to hold up as a cryptocurrency despite a reputation among prominent leaders like Twitter and Square’s Jack Dorsey as dependable and reliant. The coin is subject to violent swings in value and has not yet taken off in the mainstream as a credible mode of payment.
The virus has allowed some FinTechs to stretch their muscles on how to deal with crises, as many stocks logged their worst days since the 2008 recession. While another recession is not certain, the questions still hang in the air.