The coronavirus pandemic is testing one of Bitcoin’s most popular narratives: that in a global crisis, the unwashed masses with their worthless dollars will grovel before the fleece vest-wearing, cryptocurrency-wielding elite. Ha-ha!
Bitcoin was born out of a financial crisis, its debut announced in early 2009 with a block of data containing a headline referencing bank bailouts. Since then, a popular narrative around the technology has been that it’s a hedge against the rest of the world—when the Black Swan finally rears its ugly head, the unwashed masses with their worthless dollars will grovel before the fleece vest-wearing, cryptocurrency-wielding elite. Ha-ha!
Anyway, none of that shit has happened during the first real, global test of this theory: the ongoing coronavirus pandemic.
As the US stock market saw its worst crash since 1987, Bitcoin price has taken a serious tumble, actually, and currently sits at roughly $5,500 USD, down from around $9,000 a week ago, and with a 24-hour low of $3,867. Anybody who was hoping to sell any recently-acquired bitcoins for a profit in the near-term is probably sweating bullets right now, and everyone should say a little prayer for folks who bought in mid-plunge, believing with their genius brains that it had definitely reached the bottom.
So, what’s happening here? Maybe Bitcoin isn’t the “safe haven” asset (like gold) that some thought it was? This has led to a lot of crowing from critics, but many Bitcoiners are ideologically-driven and devoted to the project, which may ultimately be its saving grace during the current dip.
On Twitter, Bitcoiner Pierre Rochard went as far as saying that Bitcoin has proved itself to be the “ultimate safe haven asset” because “the network stays up, the exchanges trade 24/7, and the market found a healthy clearing price above—well above the 2015 low.” While it’s, uh, let’s just call it an overstatement, to say Bitcoin is the “ultimate” safe haven asset while it’s actively crashing, Rochard has a point: Bitcoin isn’t doing that badly, at least for now. It might not be an unflagging stalwart amid global chaos, but it has seen worse.