COVID-19 Impact On Cryptocurrency
COVID-19 is a pandemic that shook the world. We will explain How did the COVID-19 impact on cryptocurrency and what should we do as miners?
We just want to start off this article by saying we hope everyone is taking care of each other to go through this world-wide pandemic. Whether it is by caring for the elderly or financially supporting those who have no support. COVID-19 impact on cryptocurrency and the global economy is/was drastic because of how unprepared the world to such a situation. No one really knew how it will play out and when it will be over.
For us Cryptocurrency Miners our mining profits plummeted and so did our investments. Although, this article will not be a financial advice, but merely what we plan on doing from our own perspective to this situation. Feel free to extract the information you need and do further research to take action based on your conclusion.
We will go over different options to reduce losses and leverage this opportunity to obtain more BTC and other cryptocurrencies if you do have money to invest after setting aside emergency funds for till the COVID-19 issue gets resolved.
Cryptocurrency Market dropped well over 40% in total, most coins/tokens lost half their value and Bitcoin also dropped from $9,000 to ~$3,500. This looks like a great price for purchasing Bitcoin on such a discount since it will most likely recover its loss and so will the stock market after the COVID-19 is taken care of.
Now since all the cryptocurrency prices dropped remarkably, the majority of miners are unprofitable or will hardly be able to cover the electric costs to running the miners.
Many large and small scale mining farms will temporarily shut down because of not being able to liquidate enough cryptocurrency to pay off the electric bills. That will cause the difficulty of mining certain coins to decrease which then means you will be able to accumulate more coins in less amount of time.
Your strategy to leverage the cryptocurrency market at this state will be based on your returns and electricity costs.
There is lots of potential when the market is this low and great returns do seem promising. In this scenario, there are two ways in our perspective that we think can help you find a direction or a solution to use for your mining rig operation.
Continue Mining With The Low Difficulty
Keeping your rigs running if your electric costs are cheap can be a good thing for you. Generally speaking, below $0.07/kwh will be good for covering electricity and having a little left for profits at our current market state. Now because of all the miners that shut down, that means you will most likely end up mining more coins than you would usually mine at the regular hashrate difficulty levels. The main goal will be looking at gathering as many coins as possible to prepare for the next market rise.
Once the market rises you will see some good numbers and then you can decide to sell when it returns to higher prices.
Instead Of Paying Electric Costs. Buy Cryptocurrency Directly
When your mining rigs electric cost is more than the yield. You can then instead of having the rigs on and mining, turn them off and save that electricity costs to then directly invest it into the market for the coin of your choice.
If you are not familiar on how to buy cryptocurrencies and so far you only tried mining it, then you can look at our guide on How To Buy And Sell Cryptocurrency In 2020. We briefly explain Cryptocurrency in the article and go over methods of buying it and of course disclaimers and the basic concepts of investing.
For some places around the world it is hard for people around the world to be able to invest in cryptocurrency with FIAT, if that is the cause then keeping the miner running will be the better option!
It is highly unlikely that COVID-19 will end the exciting path that the cryptocurrency market is on. The market have had similar crashes and recovered, so it is only a matter of time until the world stabilizes again and then from there all the markets will gradually get back up and recover their losses.
The reason we think such drastic drops happened in the prices is because of the current condition the world is in, everyone seems to be panic selling and withdrawing all the money into cash. Although, cash is not the best option financially since inflation seems to be around the corner but the COVID-19 crisis is causing people to save their money in-cash for future trade.
COVID-19 impact on cryptocurrency can be perceived in different ways. Please keep in mind this is our opinion and point of view! If you have any questions please get in touch with us on our Discord server or our YouTube channel.