Crypto prices in the US have fluctuated like never before over the last 18 months or so. While there have been many debates to find out the core causes of the fluctuations, one thing has been consistently asked – did COVID-19 have a role to play, and is it still affecting the crypto market?
During the initial stages of the pandemic, COVID-19 certainly had a hand to play in the rise of crypto prices. Remember, during that period, there were advisories everywhere that the virus could be spread through banknotes. This resulted in more and more people turning to digital payment options. People’s awareness about crypto also grew at this time, which contributed to crypto’s rise. However, one thing can’t be explained – most of the country’s fiat currency was stored digitally, so why did people have to make a dash for crypto?
The relationship between COVID-19 and crypto turned out to be more complex in the following months, as waves of the pandemic waxed and waned. Sometimes, it would be seen that crypto was on its way down when COVID cases were up, and at others, it would be on the rise when COVID cases were down. This didn’t make any sense, which probably leads to one explanation only – COVID-19 isn’t really playing much of a role in dictating the prices of crypto.
What makes it even harder to assess the drivers of growth and decline of crypto is a simple fact that the crypto market is opaque. Its decentralized nature makes it incredibly difficult for even the most experienced analysts to predict the future.