At the time of writing, the coronavirus is continuing to spread across the globe. A vaccine is not yet in sight and travel restrictions are in place all over the world. As a result, financial markets and big businesses are coming under a lot of strain.
Recent news reveals that the stock markets are plunging as a result and supply chains from China and elsewhere in the region are tightening. This means that oil prices are dropping and that exports are under closer surveillance than ever.
It is clear that investors are still selling stocks both online and in the physical markets. However, many people are still waiting for confidence from governmental and financial bodies as to what we can expect in the short term. The World Health Organisation continues to monitor coronavirus as a pandemic. How long will it be before we have a clearer picture of how the illness is going to affect us financially in the long run?
Shifting towards a digital mainstream
The coronavirus crisis opens up another debate on whether or not fiat money is efficient enough in times of high crisis. Across global borders, financial transactions still take days to process and confirm. Uncertainty in security and in business worldwide is growing thanks to financial systems and networks which are struggling to keep up.
Even in times of slight political peril, it is clear that the markets are prone to wobbling. A good example of this is Brexit. The price of GBP has fallen and stayed shaky for months following 2019’s negotiations. Depending on how Boris Johnson’s Conservative majority handles the next year, the pound might fall even further.
Therefore, people continue to suggest moving towards digital money, up and away from fiat cash. But how will this benefit us in times such as the coronavirus crisis?
Can cryptocurrency help us in times of global crisis?
One of the biggest reasons why people invest in cryptocurrency is due to its security. Cryptocurrencies such as Bitcoin are extremely resistant to counterfeiting. Transactions are recorded clearly on blockchain, which means that there is no doubt what took place during the exchange of money. While there are crypto scams out there, it is simple enough to research the markets to know what’s legitimate.
There is also the fact that crypto markets do not struggle in times of uncertainty. Political and social problems rarely impact digital markets. However, as fiat money runs through centralised bodies, there are huge impacts when political drama or medical crises occur. Switching to a global digital currency could, in theory, remove such market risks in future.
There is still a lot of shakiness surrounding crypto. Many global bodies are reluctant to adopt it. This is because it is infamously volatile at times. There is too much at stake, some big businesses might argue, in investing in Bitcoin. However, with more and more people moving towards digital money, time might be running out to start adopting.
Ease of trading the world over
People are investing in cryptocurrency more and more. To start, all they need to do is download a digital wallet, pay in a small amount of fiat money, and head to a marketplace online. For example, they might use a platform such as Bitcoin Profit (https://thebtcprofit.com) to start making money.
People can invest from apps; they can even use Bitcoin and crypto bots to monitor markets for them. Therefore, anyone who may be unsure when to buy and when to sell can request programs to trade for them. This even means that they can take advantage of big spikes while they sleep.
Crucially, more people are growing warmer to cryptocurrency. Ironically, it is not yet mainstream thanks to fears of instability. However, with physical or fiat markets crashing thanks to crises such as pandemic disease, those in favour of Bitcoin are likely to argue the same in the other direction.
It will take a long time before cryptocurrency reaches full acceptance worldwide. Australia is leading the way in terms of adoption. However, with the UK in particular ready to take on Brexit administration for the next few years, it’s unclear quite when financial markets will start looking into crypto.
Coronavirus’ long-term effects
The long-term effects of the coronavirus on the markets are unknown. Optimists will predict stability, but as the disease itself is still such a mysterious presence, predictions are not coming in quickly.
A global digital currency could offer people more stability in times of supply chain crisis. But will this ever occur?