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13 Mar 2020

Bitcoin news this week: A black Thursday turns into a green Friday

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This article is not intended to be financial, investment or trading advice. This article is for information and solely for education purposes. It does not protect against any financial loss, risk or fraud.

Bitcoin has this week experienced levels of volatility not seen since the earlier years of last decade – dropping over 40 percent on March 12th before rebounding close to 50 percent on March 13th. The big movements matching the drama of the global stock markets over the last few weeks.

The question now posed is what caused the original crash and the subsequent rebound. Parallels will be drawn with markets such as the S&P 500, which also suffered one of its worst drops in history on the Thursday of this week.

But to deduce from this that Bitcoin has lost its safe haven narrative would be a mistake. Gold, the traditional commodity used as a haven from market instability also suffered drops of up to 4.5 percent, before closing around 1577$ – a 3.5 percent drop from open.

phone with crypto chart

Perhaps then this could be seen as a global liquidity crunch – forcing market players to sell off not only their high-risk assets (bitcoin perhaps) but also their supposedly safe haven assets, such as gold, to cover their margin calls from the plummeting equity markets.

For this hypothesis to gain weight, Bitcoin would need to start moving towards new highs in the mid-future whilst the world squares up to not only the corona virus, but the havoc that it has begun to play on the global economy.

But what a turn-around! The drastic rebound of the cryptocurrency markets today is clearly evident of overselling when rationality all but evaporated from the bears, and something the market quickly absorbed overnight, UK time.

People who managed to get their bids filled at 3800$ will be sitting more comfortably than most, however they would be unwise to get complacent. As we know, all’s fair in love and Bitcoin.

The above is not investment advice.

Written by Max Worontschak, in-house crypto expert at Skrill.

Max Worontschak, resident crypto expert at Skrill



Cryptocurrencies are complex products with high price volatility. They are unregulated, without consumer or financial protections. Only risk what you can afford to lose.

For more information, please go to the Skrill Cryptocurrency Risk Statement and the Skrill Cryptocurrency Terms of Use

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