By Solomon Odunayo
It’s getting more obvious that the scenario of the 2008 financial crisis, around the time Bitcoin (BTC) emerged is starting to replay, which makes it the best time for the digital currency to prove itself as a safe haven.
United States Federal Reserve (FED) has recently made an emergency decision to cut interest rates to zero.
According to Anthony Pompliano, the stern Bitcoin maximalist of Morgan Creek Digital, FED is also “launching a MASSIVE quantitative easing program to do $700 billion in asset purchases.”
This is a big deal. Historically, the last time such a scenario played out was in the 2008 financial crisis. This implies that a door of opportunity has just been opened for Bitcoin (BTC) and cryptocurrencies to thrive.
Obviously, coronavirus is presently acting beyond expectation. It has crossed the boundary of being a threat to global health, to become the way maker for a historic financial crisis.
Recall that the US Federal Reserve made a rate cut a couple of weeks ago. So, this is the second time of cutting interest rates in less than two weeks and since the 2008 financial crisis.
The View of the Crypto World and Why Bitcoin (BTC) Should Leverage the Situation
Anthony Pompliano, the co-founder at Morgan Creek Digital had foreseen this vital step taken by the US Federal Reserve since July 2019.
In one of his recent tweets, he wrote, “Since last July I have been saying that they were going to cut interest rates & print a massive amount of money around same time as BTC halving. I kept saying it was going to be rocket fuel for BTC in 18 months after halving. We are about to find out.”
Since last July I have been saying that they were going to cut interest rates & print a massive amount of money around same time as BTC halving.
I kept saying it was going to be rocket fuel for BTC in 18 months after halving.
We are about to find out.https://t.co/dZc7Nj9Zx3 pic.twitter.com/JaoxzC1SbI
— Pomp 🌪 (@APompliano) March 15, 2020
In another tweet, Pompliano averred that the decision made by the Federal Reserve (FED) to do $700 billion in asset purchases is an indirect campaign for Bitcoin (BTC).
He shared this, “The Federal Reserve just ran a $700 billion marketing campaign for Bitcoin.”
The Federal Reserve just ran a $700 billion marketing campaign for Bitcoin.
— Pomp 🌪 (@APompliano) March 16, 2020
Before the interest rates cut was officially announced, the creator of DigiByte (DGB), Jared Tate, had hinted at a very big worry than the widespread of coronavirus, which is the looming financial crisis.
He said;
“The coronavirus is no longer my biggest worry. We are now on the verge of the worst global economic & financial crisis in modern history. The government’s answer: print unlimited money.
Yes, there may be a short term downturn as people flee to cash. But with this much government money printing around the globe, we will see the greatest crypto rally in history in the coming months. It’s mathematically unavoidable. Mark my word.”
Crypto Market’s Correlation with the Conventional Markets
Bitcoin (BTC) has not proven that it’s a hedge to a financial crisis if we put the recent price downtrend in the crypto market into consideration.
The cryptocurrency market led by Bitcoin (BTC) started losing values vehemently a few days after the stock market crashed. This implies a correlation between the stock market and the crypto market. A very small number of crypto enthusiasts expected such a scenario.
However, Bitcoin still has the opportunity to demonstrate the purpose of its emergence a decade ago, by proving to be a safe haven in times of financial distress such as this. The recent fall of Bitcoin (BTC) could end up being the beginning of good days for its believers.