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Cryptocurrency Bitcoin rallies during COVID-19

by Jonathan Adams
Cryptocurrency

While a single Bitcoin was trading for $5526 in mid-March, one Bitcoin is now worth more than $10,922

Cryptocurrency Bitcoin is rallying heavily during COVID-19 as investors look for alternatives to the traditional safe havens of foreign exchange markets and stock.

In mid-March this year, a single Bitcoin was trading for just $5526.

At present, one Bitcoin is now worth more than $10,922 – a stratospheric increase of 97 per cent in just four months.

Nigel Green, CEO and founder of $12 billion finance giant deVere Group, believes the surge in interest for cryptocurrency comes as investors look for options that aren’t tied down to international trade politics.

Bitcoin, the largest and most influential cryptocurrency, shot past the key $10,000 resistance marker – all eyes are now on the critical $10,500 level, Mr Green said.

Established Bitcoin bulls and new crypto investors could make this happen this week as tensions heightened between the US and China, the world’s two biggest economies. Investors are flocking to safe-haven assets, in particular those not tied to any specific country, such as Bitcoin and gold, the latter of which hit record price highs earlier this week, he said.

Mr Green said a shift towards technology and trading from the comfort of one’s home could see Bitcoin rival gold as a long-term prospect during uncertain times.

Bitcoin is currently realising its reputation as a form of digital gold. Up to now, gold has been known as the ultimate safe-haven asset, but Bitcoin – which shares its key characteristics of being a store of value and scarcity – could potentially knock gold from its long-held position in the future as the world becomes ever-more tech-driven, he said.

Recent data showed that against the average return of the globe’s five major indices, Bitcoin’s return on investment (ROI) was some 70 times higher.

From June 26, 2015 to June 26, 2020, Bitcoin’s ROI was calculated to be 3456.98 per cent, compared to the NASDAQ (96.77 per cent), the Nikkei (11.94 per cent) and the Dow Jones (42.16 per cent).

A month ago Australia Post added to their Post Billpay service, meaning Australians interested in investing in the currency could buy the digital currency at their local post office.

Geopolitical issues, such as the US-China spat, will prompt many savvy investors to increase exposure to decentralised, non-sovereign, secure digital currencies, including Bitcoin, to shield them from the turbulence taking place in traditional markets, Mr Green said.

He said, cryptocurrencies are widely regarded as the future of money – yet what is less reported upon is that Bitcoin and its peers are increasingly regarded a safe haven in the present.

Important
This article is for information purposes only.
Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.
There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.

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