Cryptocurrencies in the COVID-19 era

Abstract

The purpose of the article is to describe the state of the financial market during and after the COVID-19 pandemic. The financial environment is facing new questions about the future, one of which concerns the role played by cryptocurrencies in the coming years. In recent years the cryptocurrency market has been experiencing spectacular growth, with more than 5,500 cryptocurrencies now in existence worldwide. They can either be used as safe haven currencies that provide protection against market volatility or as a payment system with the prospect of consolidation. Whatever the case may be, the pandemic circumstances favour the development of these digital assets. The crisis generated by the pandemic has also affected the value of bitcoin, which has been quite volatile. While it seems to be recovering, the near future is uncertain. The uncertainty brought about by the coronavirus health crisis has caused a general collapse in the stock markets. In this context, the authors review the behaviour of bitcoin, with its dips and recoveries, which can occur in a matter of a few hours. The first months of national lockdowns were mainly marked by social issues. When social distancing has become the norm, cryptocurrencies can play a bigger role than they did previously, driving the evolution of money away from cash in the direction of cashless society.