Daily reports are ominously indicating the rise of a potential epidemic being called the Wuhan coronavirus. While it’s mostly been contained in China, there have been cases of the coronavirus as far afield as the United States.
There’s also been a pretty significant bounce in Bitcoin prices today, as the household coin tops $9000 after moving in a lower range for the past few weeks.
However, experts caution against attributing Bitcoin’s jump to the coronavirus itself.
“Mainstream media claims that Bitcoin was defying traditional markets and gaining purely on the back of coronavirus were widely panned,” writes William Suberg at Cointelegraph today, going over remarks by eToro’s Mati Greenspan that center more on a basket of factors along with general uncertainty.
Citing short-term uncertainty, Suberg suggests that in fact, the coronavirus fears and higher Bitcoin prices are not correlated, and that a rampant coronavirus could actually hurt Bitcoin prices in the longer-term.
Frightened investors, he argues, who are casting around for ways to avoid fatal infection will be less likely to sit around speculating on digital assets.
Suberg also points to the following metric:
“Data from Google Trends appears to underscore the lack of correlation between the crisis and Bitcoin, with search interest in the latter remaining comparatively flat throughout the past month,” he writes.
Omkar Godbole, who covers Bitcoin at Coindesk, further describes why the coronavirus could be bad for BTC.
Many Chinese crypto retailers tend to cash in on cryptocurrencies right before the Chinese New Year holiday and reinvest in the market in the next year, (according to sources),” Godbole writes. “With the virus outbreak, that money may not return to crypto markets, possibly leading to a price drop.”