{"id":416923,"date":"2020-03-04T19:00:13","date_gmt":"2020-03-04T19:00:13","guid":{"rendered":"https:\/\/uniquehot.com\/?p=416923"},"modified":"2020-03-04T16:30:19","modified_gmt":"2020-03-04T16:30:19","slug":"coronavirus-bitcoin-black-swan-event-cryptocurrency","status":"publish","type":"post","link":"https:\/\/uniquehot.com\/news\/coronavirus-bitcoin-black-swan-event-cryptocurrency\/","title":{"rendered":"Is the Coronavirus The Black Swan Event That Crushes Cryptocurrency?"},"content":{"rendered":"

Cryptocurrency, like Bitcoin<\/a>, is an extremely new technology and financial asset, that hasn\u2019t truly yet become widely adopted or proven its use case. The disruptive new fintech has incredible potential that could revolutionize the future of finance, but only if a black swan event doesn\u2019t come along and send it to an early grave.<\/span><\/p>\n

But that black swan event may be here in the form of the coronavirus. It\u2019s already causing traditional markets to collapse<\/a>, and the high-risk cryptocurrency asset class may be next to experience a panic-induced selloff of cataclysmic proportions.<\/span><\/p>\n

The Coronavirus Has All the Signs of a Black Swan Event<\/h2>\n
Bitcoin<\/a> and the technology powering cryptocurrency assets was born from the last major economic recession.<\/span><\/p>\n
Newspaper headlines referencing the bank bailouts during this time are even referenced in Bitcoin\u2019s earliest blocks. <\/span><\/p>\n
Recession-proofing Bitcoin was among the creator\u2019s key design attributes, and include a hard-coded, digital scarcity, and a regularly scheduled reduction in supply<\/a>.<\/span><\/p>\n
Related Reading | Has the Coronavirus Put an End To the Bitcoin Safe Haven Narrative?\u00a0<\/a><\/strong><\/em><\/p>\n
And although the cryptocurrency certainly is equipped to withstand the collapse of fiat currencies, and perhaps provide a flight of safety for capital to flow into<\/a>, the asset class may simply be too young at this point to withstand a black swan event.<\/span><\/p>\n
A black swan event is a term popularized by finance professor and former Wall Street trader Nassim Nicholas Taleb, who authored a book on the 2008 recession.<\/span><\/p>\n
Black swan events are cataclysmic events that completely unpredictable and unpreventable, and grave consequences due to how the event takes the world by surprise. <\/span><\/p>\n
The coronavirus is potentially one of those black swan events<\/a>.<\/span><\/p>\n
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This is what they would call a Black Swan event.<\/p>\n
— Michael Arrington \ud83c\udff4\u200d\u2620\ufe0f (@arrington) March 3, 2020<\/a><\/p><\/blockquote>\n