Will Crypto Market Survive the COVID-19 Outbreak?

COVID-19 fears have plagued the global markets, sending the majority of commodities, equities, and other assets to a bearish journey with no known return ticket. While the global economy is struggling to stay afloat, many countries are urgently trying to figure out plans on how to contain the virus. 

The cryptocurrency market has been also largely affected by the novice virus that struck the world at the end of last year. Three months deep into 2020, there are more 700,000 affected as well as more than 33,000 deaths globally. Coronavirus has affected people’s everyday lives – schools, colleges, and universities have been closed, and some countries have even implemented a nationwide lockdown. 

While the initial response to COVID-19 from crypto markets has been negative, experts are now saying that the trend might turn to the bullish side. This theory is supported by two arguments:

Cryptocurrency might provide solutions to the issues related to the traditional financial system;

Cryptocurrencies are not physical, thus – no possibility of spreading the virus further.

In fact, the Chinese authorities have quarantined used banknotes to prevent the spread of the novice COVID-19. This suggests that many will rely on digital transactions, including cryptocurrencies.

In addition to that, according to Euromoney, some of the leading central banks are looking to launch their own version of digital currencies, which gives some validity to crypto assets.

Will Coronavirus Increase the Use Cases of Cryptocurrencies?

As mentioned above, some of the countries have been warning their residents about the risk of handling potentially infected banknotes. That being said, the World Health Organization’s spokesman said the following, after being asked whether banknotes can be potentially spreading coronavirus:

 “Yes it’s possible and it’s a good question. We know that money changes hands frequently and can pick up all sorts of bacteria and viruses and things like that. We would advise people to wash their hands after handling banknotes, and avoid touching their face. … When possible it’s a good idea to use contactless payments.”

While there was no official statement or warning from WHO, the public does not like to take any chances of getting the virus – so many are switching to card payments, e-transfers, and cryptocurrency payments. 

There are thousands of cryptocurrencies existing today, and all of them have unique use cases that can get handy in the times of pandemic. Let’s look over some of the obvious ones.

Digital Cash

For instance, Tether, or USDT, describes itself as "a blockchain-enabled platform designed to facilitate the use of fiat currencies in a digital manner." In other words, Tether is digital cash that can be very useful in the times when you need to make some contactless payments and save on transaction fees. This cryptocurrency enables users to utilize a blockchain network to transact in fiat currencies and minimize the negative factors associated with digital currencies. 

Voting

E-voting is yet another great application of blockchain technology that could be very useful in times of pandemic. Voting can be done remotely and in a safer fashion - via blockchain. In addition, e-voting would also create secure and immutable records, meaning that the results of the elections could not be tampered with.

Supply chain improvement

The successful operation of a supply chain is one of the main components of a smoothly-running business. Improving and facilitating the supply chain via using the blockchain technology is a great idea during the crazy times of pandemic when people are panic-buying and sweeping all shelves clean. 

Thanks to the blockchain technology, stores can monitor and optimize the operation of the supply chain from the very beginning to the very end of the process. For instance, Walmart uses the blockchain technology to enable its employees to scan goods in the store’s app and then track the good from the moment of production to the moment it makes it to the shelves. 

Additionally, one of the biggest shipping companies in the world, Maersk, is already utilizing the blockchain technology to track its cargo ships.

Smart Contracts Utilization

One of the greatest applications of blockchain technology is smart contracts, which are self-executing contracts. These contracts automatically verify, check and process the transaction in case all the rules of the contract are fulfilled. This allows parties to decrease risks and costs and increase productivity. 

This application of blockchain technology can also come in handy in times of pandemic. For instance, health records could be kept in a smart contract. Just like that, if health records are stored in a smart contract, the data would be available to all the parties - meaning any hospital or a research institution can have immediate access to the important data at once. All the data is also tamper-proof and transparent.

Digitization Is the Way to Go?

Nevertheless, should an emergency come and people will need to restrain from using any form of physical payment, cryptocurrency owners are definitely in a good place. Thanks to a ton of useful features of hundreds of existing cryptocurrencies, the need of every sector is met with a tailored solution. 

While cryptocurrencies can be solely used as a means of payment, some of the unique tokens are aimed at solving the issues of a particular sector and are created to play a certain role within the network. 

For instance, Digibyte, one of the cryptocurrency projects that has been on the crypto stage since 2014, can be named the Paypal of the blockchain industry. It allows users to carry out quick transactions in a secure manner with minimal fees.

Following on this, Tokoin aims to help growing companies digitize their businesses. By spending $TOKO, MSMEs are able to interact with each other on a blockchain network without the need to carry out any physical transactions – everything is handled within the network.

Another project that might help people in these struggling times is MediBloc, a blockchain project that aims to shift the medical data approach to a patient-focused one. The company has created a medical information ecosystem with consumers at its center. 

Wrapping It Up

As we progress towards a more digitized future, many of the cryptocurrency projects are proving to have real value. Yet, one of the brightest examples of why we need digitization is taking place right now – with the spread of the deadly virus across the globe, carrying out business online and not having to touch cash is one of the main reasons for increased use of cryptocurrencies.