Bitcoin and Crypto in Good Position as a New Round of Stimulus Checks seems to be gearing upNovember 18, 2020
Bitcoin prices are once again doing great, after taking a tip over the last weekend. On Monday after it, they rebounded to over 16,000 USD once again, showcasing a strong foundation that is able to soothe the markets whenever sell-off jitters begin. Now, either the bulls take the price well beyond 17,000 USD or the value of a bitcoin token remains in the 16,000 to 15,000 USD domain as a form of consolidation.
But, the interesting thing right now is the fact that this is going on in the crypto markets as numerous pieces of news are also filtering through into the same domain. The biggest news of course is the Pfizer vaccine, which was recently joined by the Moderna vaccine. The vaccine trial also showed an effectiveness rate of 89 percent, which is as good as possible. That kickstarted the traditional markets in Asia and Europe to rise sharply and the US futures to open up higher. The price of gold went up by 0.2 percent as well.
However, none of the great news changes the fact that a new coronavirus pandemic wave is hitting many important markets right now. That onslaught is so strong that many are wondering how long can the governments wait until they have to start mailing out once more the dreaded stimulus checks. From the current perspective, that moment does not seem very far in the future and when it comes, the surging bitcoin stands a chance to profit here as well.
The changes in the price of bitcoin are taking place while there is simultaneous steady progress in the development of the COVID-19 coronavirus vaccine. Recently, two companies working on the same project revealed that they are finalizing their phase 3 testing. Both vaccines showed a success of well beyond 90 percent. That is over the magical number that the pharmaceutical companies need to showcase that they have a viable vaccine that truly does offer broad protection against the novel coronavirus.
However, the news also came with a range of very somber predictions about the moment when these vaccines could become available to the general public. Unfortunately, no projection sees that happening anytime before the start of 2021. Some amount of the vaccine will be available in countries like the US, Japan, and the EU nations. However, these will be at best very limited shipments. Other nations will likely not get even that before the New Year begins. This is the reason why the consumer confidence levels went again down having in mind that the third wave of the pandemic is currently ongoing. The same applies to the overall economic recovery anyone can expect in the next two to three months.
Need for Help
Absent economic recovery and low consumer confidence mean that there will be further hardship in many sectors of industry, especially things like tourism, hospitality, and retail. The last business field is in an unprecedented crunch – retail potential has continuously gone down throughout the year. At the start of the pandemic, these businesses were forced to shut down to curb the spread of the virus both among their numerous staff (that have to be physically present in the stores) and their customers.
Then, they were allowed to reopen, but they saw only minuscule revenue in comparison to the normal summer seasons. Now, with another wave of the pandemic evolving across the world, the problems many of these companies are facing are only becoming stronger. At the same time, the elements that could be aiding them are very much centralized and under the hegemony of big outlets.
That element is, first and foremost, online sales giants. But, like in esports, digital media, and so many other online domains, there is little chance of newcomers to the field getting any relevant market share. In the field of online retail, huge companies like Amazon hold almost all relevant nodes. Thanks to this, even those stores and retail chains that could move their focus online in a rapid fashion would still not stand a chance.
The problems seen in retail are by no means unique. That is why once again stimulus measures will be needed across the globe. In the US, top economics are showcasing the need for such measures, citing all of the relevant indicators. Without a stimulus package to prop the economy, it will continue on a downwards trend.
If the government decided to hold out on the injection of a substantial amount of liquidity into the regular mainstream USA industries, the same businesses will have no other option but to go under. The moment that happens, the unemployment rate will skyrocket. At the same time, the moment when that stimulus comes in is the moment when the BTC price can gear up for a new increase.
The phenomena of ordinary citizens taking their fiscal stimulus checks and pushing the entire amount into crypto were well documented this summer. Now, experts from digital exchanges are suggesting that such a measure would almost immediately help prop bitcoin’s token towards 18,000 USD. It would also send a super-strong signal towards an entirely new phase of the current bull run and this would, in turn, prop up the stability of the same push upwards for weeks to come.
All the while, the rest of the public will be saturated by signals of people investing 1,200 USD into bitcoin and getting twice or three times that amount in six months. Unlike back in 2017, these will not be tech wizards they see on TV giving interviews, but their friends, family members, and neighbors. As this takes place, the adoption rate can only go up globally, but most importantly, it will go up in the developed marketplaces. All of this boils down to one unified reason why the crypto markets are eagerly awaiting that moment when the stimulus package goes out. Now, it is only a question of whether or not they will need to wait for President Joe Biden to see the same take place.