DeFi by Woonkly
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DeFi by Woonkly

How COVID-19 Reshapes Blockchain, Bitcoin, and DeFi in 2020

The SARS-CoV-2 outbreak has forever changed the way we conceive things we ‘understood’

Bitcoin: is it a safe haven?

About the Bitcoin, there have been narratives of uncorrelated assets and safe haven for a while. The virus outbreak has shifted the talk into focusing the safe haven, i.e. this asset move in the ‘opposite’ direction of other assets. However, Bitcoin has proved to be a highly liquid asset that fluctuates on its own rather than correlating to other markets directly.

Photo by Dmitry Demidko on Unsplash

Central Currencies and Cash

A fixed supply is a very interesting feature of Bitcoin. We know that, eventually, inflation will show up in the fiat markets coming along with harsh consequences, namely the devaluation of cash. Thus, people looking for what else there is; they find BTC, read Satoshi’s BTC paper and realize decentralized systems exist.

Stablecoins

USDT and other top stablecoins have seen their market capitalization rise in the past weeks. While fiats lose value concerning the USD, one of the safe havens in fiat, people keep looking for dollars ($). But, there is a limited allocation of physical dollars that people can trade. Plus, the lockdown and service shortage worldwide makes it hard to trade into USD.

Photo by Mackenzie Marco on Unsplash

Defi: Decentralized Finance

Defi is at an early stage of development. However, the spread of the blockchain and Bitcoin has accelerated years due to the pandemic. Thus, the spotlight also illuminates Defi and the projects working on creating decentralized programmable solutions.

Privacy is at stake

COVID-19 has rewired our thinking of security. On the one side, people have become more aware of health measures they should embrace. On the other, the lessons come at a high price, totaling +120k deceases worldwide at publication time.

Photo by Lianhao Qu on Unsplash

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