The world of crypto surely knows where it’s going ever since the Coronacrash of mid-march which pulled stock markets down into the abyss. Bitcoin, the most famous of all cryptocurrencies, has risen from $3,500 to $10,000. The tweet by Edward Snowden, in which he claimed Bitcoin was finally cheap, famously marked the bottom. Many analysts had predicted beforehand that it would touch this level before the end of the week.
Although many onlookers will claim that the halving, foreseen for 12 May is largely responsible, the fact that it touches this level again so soon after the crash is remarkable.
Crypto versus gold and oil
The rise in Bitcoin’s price above $10,000 makes sure that all worldwide headlines will feature the crypto market today, and many analysts will be eager to point out that Bitcoin has outperformed many other safe have assets.
Although in March analysts were eager to state that Bitcoin could no longer be seen as a safe have during market crashes, it has by now outperformed the classic crash hedge good ‘gold’ in many ways. Eternal gold bull Peter Schiff has not reacted to Bitcoin’s rise just yet.
The other classic good of choice during bear markets, oil, also stole the spotlight this year. Thanks to a price war between Russia and Saudi Arabia, oil is at historic lows.
Markets miss direction
Although world stock markets rose in the month of April as the first indications of a possible passing of the Corona-lockdowns became public, they have missed direction in the month of May. Many analysts also fear that the monthly unemployment rate in the US, which will be made public tonight, will lead to a realization that the economy is not ready for a quick rebound just yet.
With 33.5 million now unemployed in the world’s largest economy, it is possible that the US economy will need several years to recover from Corona.
At this moment the market seems divided between optimists and pessimists. The former point out that economies will reopen and many of those laid off will be rehired, the latter state that the unprecedented stimulus and mounting economic toll will bring a high cost with it, even to those who still have a job.