BitMEX Reflects on Market Reactions to Coronavirus, Predicts Inflation Woes and a Golden Chance for Bitcoin – Coingape

Observing the economical ramifications of Coronavirus, the research arm of cryptocurrency exchange BitMEX has concluded that the pandemic is going to force unprecedented changes upon economic regimes. In this, however, BitMEX believes that Bitcoin (BTC) could truly thrive under these conditions.

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One for the Books

As is commonly known by now, the stock/crypto market crash spurred on by Coronavirus has become a historical one, noted by BitMEX as one of the largest crashes next to the 2008 Global Financial Crisis, the 2000 Dotcom bubble, and even the Wall Street Crash of 1929.

Looking ahead, BitMEX treats this crash with a little more optimism thanks to the existence of Bitcoin. Noting that the value of BTC had dropped by just over 50%, BitMEX research seems to believe that even this incredibly volatile cryptocurrency can “shine” in the “inflationary aftermath of the response to the crash.”

It justifies this by going on to explain that traditional financial markets and economies overall are going to suffer, should the economic landscape fail to adjust accordingly. BitMEX notes that previously, the response to the 2008 crash was to lower interest rates from 5.25% to 0.25%, and similarly the 2000 Dotcom bubble caused rates to drop from 6.5% to 1%.

The team at BitMEX Research writes:

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“Federal Reserve policy is based on models which assumes that monetary policy does not impact the structure of the economy, instead it just eases the flow in which money flows through the system. However, in our view,
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