RATE Group | Bitcoin price drops despite promising ‘safe haven’ status during coronavirus spread
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Bitcoin price drops despite promising ‘safe haven’ status during coronavirus spread

02 Mar Bitcoin price drops despite promising ‘safe haven’ status during coronavirus spread

Posted at 08:10h in Bitcoin News by

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Despite claims that the price of bitcoin would continue to rise this year as a “safe haven” asset at a time equities markets are concerned about the spread of coronavirus, the opposite has instead occurred.

After breaking through $10,000 Feb. 9 and then peaking at $10,474.20 Feb. 18, bitcoin has plummeted, returning to levels last seen in late January. As of 9:20 p.m. EST, bitcoin was trading at $8,568.65.

Whether the spread of the virus is to blame for both the initial rise and subsequent fall is open to speculation. One argument is that the price increase itself was driven by investors who believed that bitcoin would become a safe haven asset but when that didn’t happen, they bailed out. The only contagion in that scenario was unsustainable hype.

Galaxy Digital Chief Executive Officer Mike Novogratz noted on Twitter that investors tend to “take leverage down” and book profits during black swan events.

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