The crypto world has a tendency to exploit crises to promote their favorite crypto assets as safe havens, and the coronavirus outbreak is no exception, according to a blog that likes to diss crypto.
In the past, cryptocurrency lovers have used Brexit, a banking collapse in Cyprus and social breakdown in Venezuela to rationalize the case for buying “MOAR bitcoin”, writes Izabella Kaminska for Financial Times’s Alphaville.
Full disclosure: The headline for this article, “Coronavirus Is Good For Bitcoin,” comes from Kaminska, who says it’s based on the crypto meme, “This is good for bitcoin”.
Bitcoin (BTC) slumped 6 percent on the Chinese New Year and uncertainty around the spread of the coronavirus.
The coronavirus-is-good-for-bitcoin logic is that fiat banknotes are dirty. Handling them helps spread it. Protect yourself with digital-only crypto.
“This is indeed a remarkably callous, opportunistic and tone-deaf thing to do,” wrote Kaminska, editor of FT Alphaville. “Don’t let moral anguish over the deaths of potentially thousands of people get in the way of an opportunity to shill some crypto and pump up the price of bitcoin. As ever, crisis is opportunity for cryptocurrency lovers.”
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Kaminska reminds readers that fiat can be exchanged digitally too and that China, considered the source of the coronavirus aka Wuhan virus, has one of the highest digital transaction rates in the world.
However, the visuals are not good when it comes to exchanging banknotes at markets where wild animals are sold for food.
More than 80 people have died since the first patient was identified on Dec. 8 in Wuhan in central China. There have been almost 2,000 confirmed cases including 10 outside China and five in the U.S. as of Sunday.
The rush to talk up crypto over fiat currency is based on some truth and some fear — like losing money. The coronavirus outbreak in China could weigh on crypto prices, Coindesk reported today.
Besides the virus outbreak, the crypto market could be hit with a double whammy with the Chinese New Year, according to Jason Wu, the CEO and founder of crypto lender DeFiner. Many Chinese crypto retailers tend to cash in on cryptocurrencies right before the holiday and reinvest in the market in the next year, Wu told Coindesk.
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Some blockchain and crypto firms have promised to help victims of the coronavirus in Wuhan, China, according to Cointelegraph. Cryptocurrency exchange Binance pledged to donate $1.44 million. Blockchain marketing service firm Krypital launched a charity donation effort to acquire medical supplies for Wuhan coronavirus victims.
On Twitter, Trexia XRP encouraged people to stop using paper money to protect against a virus that “MUTATES FROM HOSTS TO HOSTS.”
Another Twitter user wrote, “Fiat is dirty and is cause for the spread of the corona virus.”