EToro CEO Yoni Assia believes that there are many factors at play in the current cryptocurrency market, including the economic situation in the US amid the ongoing COVID-19 pandemic.
“I think it’s a coincidence that has triggered such a rally ever in both the cryptocurrency and equity markets,” Asia told Cointelegraph on Thursday. “We are seeing a unique monetary and fiscal response from federal governments around the world, leading to zero interest rates, and in some places even negative interest rates.”
Back in March 2020, Bitcoin (BTC) fell below $ 4,000 when preventive measures for COVID-19 made global headlines. Since then, however, the cryptocurrency market has grown exponentially, with Bitcoin reaching a price mark above $ 60,000 and the total market value exceeding $ 1 trillion.
“We see an unprecedented amount of money printed by governments around the world – some of them represent a unique and entirely new concept of direct consumer incentive controls,” said Asya. “It certainly sparked the largest debate in human history about the value of money – a debate that started with great enthusiasm in the field of cryptocurrencies,” he added, referring to the scarcity of Bitcoin.
The maximum supply of Bitcoin is 21 million coins, although not all of them are so popular yet. Every 10 minutes, a certain amount of new coins from this distribution is released into the ecosystem as a reward for miners who contribute to the network. However, the number of coins available for distribution over time will only decrease. Over the past decade, block rewards have decreased from 50 BTC to 6.5 BTC. After all, there will be no more coins in circulation, despite a strong precedent for increased demand by investors.
Asia said the dearth of natural networks is a simple enough concept for ordinary people to understand, and she also noted that people do not perceive excessive pressure and low interest rates in traditional paper money markets. He also noted that buying cryptocurrencies and stocks is now within the reach of retail buyers around the world, and is stimulating massive participation from people who may not have participated before.
He believed that these factors also sparked “renewed interest that we did not see until December 2017, so since the cryptocurrency rally of 1.0, we have not seen as much interest in cryptocurrencies as it is now with the cryptocurrency rising 2.0 after us”.