These are complicated days for the crypto market. Well, after the collapse suffered on March 12 by the crypto market, the price of the main cryptocurrency in the world has suffered a significant level of volatility. What threatens to make investors flee, seeking security in these uncertain times. Despite this, Social Capital CEO Chamath Palihapitiya claims that he is confident in the future of Bitcoin.
Volatility against Coronavirus
Coronavirus has been an extremely disruptive factor globally. Not only for the health of people, counting in thousands the daily deaths due to this disease. Also for financial markets, which have been strongly affected by the interruption of productive and commercial activities imposed by COVID-19.
The crypto market has not been an exception to this trend. Well, at the same moment that the Coronavirus began to strongly impact the western world, with its arrival in Italy. The financial markets crashed one after the other, including a 49% drop in the BTC price in less than 24 hours.
Since then, Bitcoin has had the ability to recover most of the lost value. However, the situation in which it finds itself is not at all as solid as it was before the arrival of COVID-19. Well, volatility has been constant in the cryptocurrency price for the past few days.
Chamath Palihapitiya still trusts Bitcoin
And it is precisely this level of volatility that, according to Chamath Palihapitiya, would make Bitcoin still too immature a currency to be reliable. Since, being seen by traders as a merely speculative product, and not as a currency for financial transactions. It would not possess the necessary stability to compete with Fiat money.
Therefore, for Palihapitiya, the Coronavirus crisis could be a defining moment for Bitcoin. Representing an opportunity for financial traders and speculators to manipulate the BTC market, making sharp price rises and falls common, come out of it.
This would lead to the creation of a traditional infrastructure around BTC, which in the long term will provide it with the necessary stability to transform itself into one more currency. Well, currently, Bitcoin cannot “be used effectively” due to its high level of volatility.
With this, Chamath Palihapitiya reintroduces the issue of volatility as a crucial element for the development of Bitcoin as an alternative to fiat money. Since, as long as the crypto market remains in the hands of a small group of crypto whales, it will never be able to develop its potential as a virtual currency.
What makes Palihapitiya’s statements our Today’s Data here at CryptoTrend.