At the time of writing, several cryptocurrencies are showing new signs of life. Bitcoin, for example, is once again trading above $7,000 for the second time this month.
Bitcoin Has Broken $7K Again
In addition to BTC’s sudden burst, Ethereum is trading for $170, while other major coins – such as Ripple and Litecoin – have also shot up. For the most part, the cryptocurrency industry appears to be on a path of recovery along with stocks as the Dow Jones has shot up more than 400 points since Friday’s early morning hours.
The surges are likely stemming from two big factors. For one thing, President Donald J. Trump has announced that some state economies are likely to reopen their doors for business in the coming weeks, or prior to May 1. Some states have not experienced hardcore coronavirus effects and can therefore begin operating normally prior to the month’s end.
Ultimately, Trump is leaving it up to individual regions to make their own decisions about when they can return to business as usual. Already, some areas – such as New York, arguably one of the hardest hit regions in the U.S. during this pandemic – have stated that they’re looking to keep non-essential ventures closed through mid-May, but for many others, things are about to get a lot better, thereby signifying an end to economic ailments in America.
The other thing that’s likely contributing to bitcoin’s sudden boom is the fact that Libra is downsizing. Facebook just announced that it’s Libra project will be revamped to support only stable coins or fiat-based tokens, meaning that the big payment network executives were originally planning has been put on the backburner.
The Libra Association has hinted that they are looking to keep regulators’ concerns to a minimum through this process, though there is also evidence that doing things this way will allow Libra to be released sooner and thereby take advantage of the surge in digital payments that have occurred thanks to the spread of COVID-19.
Founder of Quantum Economics Mati Greenspan explained in a statement:
This is good for bitcoin… Bitcoin is up six percent… Facebook’s new watered-down version of Libra is an admission that even they are not able to replicate the immaculate conception of bitcoin and that their blockchain will no longer be a serious competitor to any existing crypto asset. It will, however, be a serious contender to PayPal, Venmo and Square.
Is Libra Shrinking Into Oblivion?
Yoni Assia – the chief executive of cryptocurrency exchange e-Toro – says there is a downside to the whole shift, however, in that now Libra will be far more centralized. Yoni explains:
The main downside of these changes is that the system is less open and less decentralized. Therefore, the bitcoin community will probably disregard this as another centralized project.