Recently, the crypto market has been on a downward trajectory. The crypto market has lost 10 of billions of dollars in market capitalization. Most of these losses occurred on Thursday, March 12, which has come to be known as Black Thursday. Not only was the crypto market affected, various other markets such as hold and the stock market also experienced a meltdown.
Edward Snowden Still believes in Bitcoin
When the price drop occurred, Edward Snowden, the American whistleblower, stated that he felt like purchasing some Bitcoin. He added that he believed the price drop was due to panic selling and it was not driven by fundamentals.
On Thursday, March 12, Bitcoin lost more than half of its market cap in just a few hours. This was the lowest dip in the price of BTC in almost 12 months. While crypto prices have recovered a bit, they are still well below 2020 highs.
Bitcoin Price Vs S&P 500
As of recent, many people have criticized Bitcoin due to its inefficiency to hedge during traditional market turmoil. As discussed in previous reports, Bitcoin has continued to hedge in the long term. The current environment is a shock to the whole world. Countries have been put on lockdown, and businesses are fighting to stay afloat. A need for cash has caused a liquidity crisis within banks, and the need for individuals to sell liquid assets. Bitcoin is still a very young asset class and wasn't predicted to be tested this hard so early on. What we do know is that the last 1 Year, Bitcoin price has continued to be a global hedge despite the recent sell-off. The chart below shows the comparison between Bitcoin price and the S&P 500. Bitcoin price has returned +34%, while the S&P 500 has dropped around -18%. As you go farther back in history, people start to see how non-correlated Bitcoin still really is.
Even crypto traders who have been in the crypto market for years, claimed that the events of March 12 shook them to the core. One of them was Demeester, who tweeted that despite investing in BTC for years, the events of that day came at complete surprise.
However, Snowden was unfazed. He tweeted that the meltdown was the first time he had seriously considered purchasing some BTC. According to him, the price drop was driven by panic instead of reason. This is not the first time he has talked about crypto. In the past tweets, the Whistleblower has discussed crypto. For instance, when the DoJ announced in September 2019 that they would confiscate all proceeds from Snowden’s book sales, he tweeted that it was good for Bitcoin.
Serious Support from the Community
He has been a proponent of crypto for many years. When he said that he might consider buying crypto, many people were elated. Thus far, his tweet has been retweeted over 4.9K times and received over 22.2K likes.
He also accepts crypto donations for those who believe in the Freedom of the Press. During a 2018 interview, he called crypto the “first free money” system. He said that while BTC had not yet achieved the status of private money, it was the first “free money” system. Some who responded to his recent tweet said that Bitcoin should be considered a serious alternative to the monetary system. This sentiment received a lot of support from those who replied to Snowden’s tweet.
The tweet by Snowden helped to provide some consolation to those who were feeling hopeless. They now believe that the events of Black Thursday were the elusive Bitcoin bottom. Some crypto traders have said that if this is not the bottom, then the market is in for a horrible year. However, some claim that the price could still go lower.
In the crypto market, it is usually hard to predict anything. However, there is a clear correlation between COVID-19 outbreak and plummeting prices. Until the virus outbreak is resolved, things could keep getting much worse.
Image Source: Pixabay