The price of Bitcoin has risen to pre-crash levels. The top price today, $7,641 according to data metrics site CoinMarketCap, is around the price of Bitcoin just before the market crashed in mid-March. Its current price is $7588,78.
If sustained, this suggests that Bitcoin has survived the worst global market crash in decades, in a little over a month. Of course, the coronavirus crisis is far from over: this may not be the last, or worst, crash since Black Thursday.
Last month, Bitcoin, long championed as an asset that doesn’t track regular markets—did exactly that. Around March 12, it followed the traditional markets and crashed, falling from around $7,650 to its lowest price since March 2019, $4,107, according to data from CoinMarketCap. A few days prior to the crash, Bitcoin's price was around $9,100.
But safe-haveners beware: Bitcoin might have recovered because global markets and major economies begin to emerge from lockdown.
Goldman Sachs wrote last Monday that "The Fed and Congress have precluded the prospect of a complete economic collapse. Investors have been encouraged by the 'do whatever it takes' approach of the Fed." The Fed has injected $5 trillion into struggling money markets. It has also cut its interest rates to near-zero.
The signs were there
The good-fortune was already apparent last weekend, when Bitcoin's price was sustained throughout Saturday and Sunday. In previous weeks, it crashed upon the closure of the stock markets.
Whether Bitcoin's resurgence is maintained is as uncertain as the times. But safe-haveners, as well as Decrypt, may argue that they saw this coming all along.
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.