How Does Corona Outbreak Offer Ideal Time to Enhance Knowledge About Bitcoin?
As people all across the globe are following quarantine measures to deal with the COVID-19 outbreak, it is the ideal time to enhance your knowledge about Bitcoin. Some experts and researchers prefer to call Bitcoin as digital gold. While other studies claim that BTC faces tail-risk within the crypto markets. However, the currency has not been exposed to tail risk when it comes to other asset markets that may include equity markets or gold. And, the recent coronavirus pandemic is a tail risk occurrence. The world witnessed major stock market downfall due to the novel virus that originated from China’s Wuhan. Dow Jones Industrial Average registered a fall of -7.8 percent on March 9, 2020. So far, the virus did not cause much impact on cryptocurrencies and the upcoming Bitcoin halving event scheduled to take place in May this year and it could lead to a price surge. The price of BTC may double in the coming few months.
Presently, huge damage has been caused to the status of circulating currency. And, the entire fiat money system strongly faces the prospects of a collapse. The instant future of fiat currency hovers around Dollar’s prospects as the reserve currency. A strong crisis has been reported for the Dollar. And, the crisis may further intensify due to the government’s rising debts, declining purchasing power for Dollar, and surging interest rates. The fiat may decline in value due to the huge quantity of government debt outstanding. And, the debt may surge in the months to come along with the collapse of fiat currency.
Regulation has emerged as one of the most crucial factors that have impacted BTC prices. The surge in cryptocurrencies is arrested every time a government cracks the policy whip. The lack of regulation has also undermined the growth of Bitcoin. The emergence of Bitcoin has transformed everything right from payment-related transactions to how the money will be raised in the private market. Recently, American banker Marco Santori went on to call Bitcoin a regulatory platypus, one that failed to fit properly in an established asset class. Cryptocurrencies have emerged to be freewheeling and not restricted to any country’s border or particular agencies within the government. The nature of cryptocurrencies has posed problems to policymakers as they are accustomed to dealing with clear definitions for assets. Lack of regulations by specific countries has gone on to empower Bitcoin. Some nations in South Asia are pointers in methods of dealing with cryptocurrencies. Cryptocurrency trading is free from tax in South Korea, but the country is planning to change its stance now. The strongest indication has surfaced from Japan regarding the future policy regarding regulation about BTC. Japan had already legalized cryptocurrencies as legal tender in 2017. The countries’ governments passed the Virtual Currency Act that defined the currency effectively. They are considered as assets for accounting purposes. And, there is strong confusion about cryptocurrencies the way US regulatory agencies classified it. The IRS considers it as property and CFTC considers it as Bitcoin.
Sometime back, the former head of the International Monetary Fund Christine Lagarde said that the government should think of providing their own cryptocurrencies. It will prove helpful in preventing systems emerging as safe havens for scammers and hackers. She went on to say that central banks must create digital cash for mushrooming networks of private financial transactions. A cashless state is also known as a surveillance state. It will help the countries’ government to have adequate visibility in every transaction that you make. Bitcoin cannot be termed as equipment for privacy. However, it continues to grow at a robust pace. In China, the government has the power of freezing your WeChat account. However, the same cannot be done with BTC. Even if the government blacklists your BTC wallet, you can still make transactions with it that you could not have done with WeChat.
Bitcoin is based on blockchain. Blockchain can be defined as a distributed database that extends support to Bitcoin and other digital currencies. It permits an accurate record of transactions that remain decentralized via millions of computers all across the globe. You get the benefit of low transaction fees, faster receipt of funds, and you can make international customers. The decentralized digital currency allows you to build great trust with your customers.
The governments all across the globe have indicated that they are ready to allow the new Bitcoin revolution to take place. And, amid such strong and positive development for Bitcoin, it becomes imperative to boost your knowledge about the digital currency.