Is Cryptocurrency Trading Safe During COVID-19?

Is Cryptocurrency Trading Safe During COVID-19?

Undoubtedly, China is one of the biggest cryptocurrency investment hubs around the globe. In relation to that, the country was once the epicenter of the outbreak and became negatively impacted, especially on its economy. That said, the COVID-19 pandemic is the first global health crisis that greatly affected the bear market trends since the start of cryptocurrencies. Hence, the market upheaval offers an appropriate opportunity to test the stability of cryptocurrencies, such as Bitcoin, and Ethereum.

With COVID-19 around every corner of the globe, many investors are wondering if trading cryptocurrencies is still safe. Aside from that, it’s human nature where they protect their assets, wealth, and investments. Hence, people are doubting if cryptocurrencies are a safe haven or a big risk during uncertain times.

Are Cryptocurrencies Protected Against Inflation?

Unlike fiat assets and currencies, there are a number of cryptocurrencies to preserve their value. For example, blockchain’s system is developed that there should be a concrete number of coins to be mined, and there’s a slight chance that economic upheavals will have any effect on the cryptocurrencies’ value.

Bitcoin Halving is essential to verify the number of bitcoins in circulation. According to many Bitcoin experts, the price of Bitcoin seldom fluctuates immediately after or prior to a halving transaction. In most cases, its price remains consistent and completely predictable despite the economic downfalls and fluctuations of fiat currencies by the Metcalf Law.

With Metcalf Law, it adopts the principle that the network’s value depends on the network’s size. The Metcalf Law applies to the likes of major cryptocurrencies, such as Bitcoin and other altcoins. That said, unlike other assets, Bitcoin is definitely a safer and more predictable investment option for individuals interested in discovering investment opportunities during the COVID-19 pandemic.

Cryptocurrencies as the Asset Class of the Future

In an economically-turbulent period, many countries, such as India, China, Japan, the U.S., and EU countries, have a significant boom in switching to cryptocurrency investments. With COVID-19 continuously impacting the major financial states, Europe has portrayed passionate interest in altcoins and stablecoins.

A bigger number of investors believe that cryptocurrencies are here to stay. Many veteran cryptocurrency traders have been holding on to major cryptocurrencies like Bitcoin for seven to eight years. Ever since, the rising value of Bitcoin hasn’t slowed down yet. Hence, its value continues to rise as more and more investors are hopeful that cryptocurrencies, such as Bitcoin, have the potential to improve the current financial state of economically-ravaged nations.

Cryptocurrencies can lessen intermediaries; thus, setting up an essential platform for settlements, acquisitions, and payments. Its predictable and consistent rise in value makes crypto assets an excellent investment prospect for both novice and professional market investors worldwide.

Trends In Cryptocurrency Trading

If you’re wondering whether cryptocurrency is safe during and even after the COVID-19 pandemic, here are some of the trends that are expected behind the monetary revolution.

Digital Currency

Since the COVID-19 pandemic wreaks havoc on every country’s economy, governments are proactively searching for new ways to recover and stay afloat. With traditional investments, such as savings, properties, and bonds, many investors are exploring different assets that return better prospects.

Due to the outbreak, we’ve seen a dramatic rise in cashless transactions and online shopping. As a result, it has sparked interest in digital money. Aside from that, cryptocurrencies are becoming more operational through stablecoins with prices pegged to central bank exchanges as well as revolutionized digital wallets, making it more convenient and quicker to swap tokens.

Technological Breakthroughs

Another thing is that many technological advancements are emerging to support cryptocurrencies. One of the major challenges of cryptocurrencies is the significant amount of energy-intensive computing systems that are essential to make trading, and other crypto-related transactions.

New equipment, tools, and infrastructure are currently being developed to allow blockchain technologies to be adopted in financial markets. In case you didn’t know, the latest innovation is DeFi, or otherwise known as Decentralized Finance, integrating blockchain to develop completely automated and digital financial markets. Some of the examples are derivatives trading and decentralized exchanges without standard intermediaries like banks and stock markets. Thanks to blockchain technologies, we’re going to encounter more innovations in the world of cryptocurrency.

Should I Trade in Cryptocurrency in a Post-Pandemic Era?

As a potential investor, you’re probably one of those people who are wondering about the safety and stability of cryptocurrency trading after the COVID-19 pandemic. Does trading cryptocurrencies help you become the next millionaire? Although nothing is impossible, it’s definitely a gamble.

In early 2020, the opportunity was when prices were much more affordable and lower, and the markets were filled with confusion and uncertainties. Currently, you’re left with taking the risk of purchasing whether an extreme high or extreme low selling.

Even before the COVID-19 pandemic, cryptocurrencies remain speculative and volatile assets. As a result, many investors have been badly battered in previous years by starting at the top. However, during these times, it may be slightly different. Aside from that, the cryptocurrencies won’t disappear for good.

In a nutshell, you won’t have any guarantees. At the end of the day, it completely boils down to how much you can afford to lose.


Like many traditional businesses, assets, and investments, cryptocurrency trading isn’t stable during pandemic according to some research. As mentioned, it’s the nature of people to safeguard their assets, wealth, and investments. Hence, during the recent global health crisis and economies are heavily battered, no cryptocurrency traders are willing to trade when the possibility of recovering from the impact of COVID-19 is shallow.

Undoubtedly, every citizen is completely aware of the negative impacts of the COVID-19 pandemic on each country’s economic welfare and personal wellbeing. It’s inevitable to think that some countries cannot recover right then and there with this health crisis.

With COVID-19, both traditional and cryptocurrency markets have been altered. Hence, the outbreak sparks peoples’ curiosity on what happens with cryptocurrency trading after things go back to normal.

On the contrary, decentralized platforms support every cryptocurrency in the market. That said, it is being considered by many people worldwide and is completely independent in government sectors. In relation, the COVID-19 pandemic made people shift the traditional currencies to cryptocurrencies.

Publication date: 
01/07/2021 - 10:30

The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.