Today marked a bloodbath across the entire global financial system. The growing spread of coronavirus, plummeting oil prices, and fears of recession led to one of the biggest market sell-offs in recent history.
Both the US equities and cryptocrypto markets drop significantly. So what do the experts have to say about it?
The founder of crypto intelligence firm Messari Crypto, Ryan Selkis, published a dark take on Sunday night in a long Medium post titled “RIP Moon Times.” According to Selkis, “the coronavirus will be the defining event of our generation” and could “roil global and domestic elections, destroy currencies, create unpredictable credit crises,” and more.
In his post, Selkis accurately predicted what many analysts expected as of the weekend: the tanking of S&P 500. The US equities index fell 7% on Monday morning after oil prices plummeted by over 20%.
With regard to crypto, Selkis does not see a bright outlook in the short-term for Bitcoin and alt-coins markets:
“Bitcoin is a risk asset. It’s not a safe haven in a recession, but rather a check on fiat inflationary pressures. It will sell off with the rest of the risk asset market at first, but may perform moderately better if there’s real juice in the 'digital gold' meme. The halving narrative is completely dead now. The only thing that matters with respect to the halving now is whether it breaks the mining market.”
What other crypto experts have said
Anthony Pompliano of Morgan Creek Digital had a slightly different take on Twitter, saying “the virus isn’t the cause, its an accelerant,” of the market downturn. “ALL THE WARNING SIGNS WERE THERE FOR MONTHS,” he wrote.
“Don't let them feed you the nonsense that this was a black swan,” he said referring to a blog post he wrote last July, where he called for investors to divest to cash and into a small Bitcoin allocation to brace for the next economic downturn.
ALL THE WARNING SIGNS WERE THERE FOR MONTHS.
Don't let them feed you the nonsense that this was a black swan. The virus isn't the cause, it is the accelerant.
Like Pompliano, Wall Street veteran and AvantiBT crypto bank CEO Caitlin Long attributed the market downturn to macro factors like global consumer debt. “The virus was just the pin that pricked the debt bubble & revealed the magnitude of the solvency problem,” she said on Twitter.
THIS ISN’T #coronavirus!!! 😬This is result of ~50 yrs of Western economies consuming more than they produced, finally coming home to roost. The virus was just the pin that pricked the debt bubble & revealed the magnitude of the solvency problem. Stay safe out there 🙏
Pomp’s Twitter rival and Bitcoin critic Peter Schiff, of Euro Pacific Capital, had plenty to say today as well. Schiff predicted that Bitcoin’s price will plummet by half ahead of the Bitcoin Halvening—the halving of block rewards for miners which has long been thought to lead to a boost in the price of BTC.
With the #Bitcoin halving just two months away and global financial markets in turmoil, the news couldn’t be more bullish for Bitcoin. Yet the price action couldn't be more bearish. Looks like it’s Bitcoin’s price that will be halved! Not exactly the halving hodlers expected.
Ari Paul, co-founder and CIO of Block Tower Capital, more or less echoed Selkis’s point by conceded that “BTC isn't a safe haven (yet).”
BTC isn't a safe haven (yet). I've always predicted it would decline with a big equity sell off. Frankly, I'm very surprised at how well it's held up. BTC up 7%+ on the year with equities down ~15%. We'll have to see what happens, but darn good performance for a risky asset.
Paul said that Bitcoin’s price is currently tied with the equities market and predicted that “it would decline with a big equity sell off.” Nonetheless, he also pointed out that Bitcoin is still up around 7% percent on the year despite equities plummeting by around 15%. “We'll have to see what happens, but darn good performance for a risky asset,” he said.
Developing stories:
March 12
A sudden market shock: The price of Bitcoin crashed by $1,000 in under an hour. All coins—barring stablecoins—are in the red, with many seeing losses between 20-30%.
March 11
UK announces £30 billion coronavirus package: Chancellor Rishi Sunak unveiled a £30 billion package to help the economy through the coronavirus outbreak.
Altcoins showing signs of life: Though roiled by the market crash, everyone’s favorite altcoins seemed to come back a bit today. Here’s a l...
Others attributed the crypto sell-off to liquidity concerns. Tushar Jain, managing partner of MultiCoin Capital, said hedge funds may be selling off their crypto to “raise cash to cover positions elsewhere.
I think this drop in crypto prices is from the traditional hedge funds who held some BTC and are being forced to sell anything liquid to raise cash to cover their positions elsewhere.
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