Price fluctuations between cryptocurrencies and coronavirus
Many observers of cryptographic markets believe that the very direction of the cryptographic course since the beginning of the year is largely dependent on the coronavirus epidemic. So is this interpretation at all correct or is it just an accidental overlap of unrelated events?
The coronavirus and the mining power of the Chinese
The coronavirus affair will certainly leave a strong mark on the Chinese economy. The growing number of all the diseases and the ubiquitous quarantine have resulted in fewer workers coming to Chinese factories every day. The natural consequence of this state of affairs is smaller production and weakening trade. Many experts also claim that the worsening situation in the country of the measure will have a negative impact on the economies strongly linked to China.
Such a dependence is completely absent in terms of the mining power of the mines themselves, which have absolutely no interest in the coronavirus. As far as CoinShares Research is concerned, it estimates that more than 1/3 of all mining poles are already located in China, and the decline in capacity alone would be affected by the network slowing down. So far, such a phenomenon has not been completely observed, on the contrary. BTC’s network’s Hash Rate really is doing very well, and with the next few weeks, however, it is breaking the historical highs. The biggest digs, however, do not indicate any weaknesses and work the same as before.
Reasons for potential increases
The strong appreciation of the crypto market actually results from quite different reasons. Mati Greenspan believes that it all started with an attack by an American drone on an Iranian general, which resulted in the death of a military officer. It was this event that started a very dangerous conflict between the US and Iran. The price of the BTC fired then and still maintains a bullish attitude both fundamental and technical.
Another reason for the strong upward movement is the division of the reward for the excavated block, which is already approaching. For the mining itself and the maintenance of the network to continue to pay off the miners, the price of BTC has to rise significantly.