Wuhan Coronavirus Outbreak Could Cause Potential Disruption to the Crypto Market
Since the coronavirus patient was identified on Dec. 1, 2019, in Wuhan, the capital of Hubei province in China, the virus has since claimed at least 100 lives. With at least over 4,500 cases confirmed worldwide, the Dow Jones Industrial Average has seen its fifth consecutive daily decline, dropping 1.6%. The S&P 500 also declined 1.6%, witnessing its first drop of more than 1% since October 2019. Although the S&P 500 turned positive after the World Health Organization declared an emergency meeting on handling the coronavirus outbreak, Hong Kong’s Hang Seng Index and Shanghai A shares Index has seen substantial dips.
According to crypto research firm Chainalysis, China has the status as a crypto investment hub, as it houses the most crypto exchanges in the Asia-Pacific region, which has 40 percent of the world’s top 50 exchanges.
Jason Wu, the CEO of crypto lender DeFiner, admitted to canceling a dozen meetings with his crypto clients in China after the outbreak. He said, “We planned a 10-city tour to talk with potential clients in China. Nobody wants to attend any crypto-related conferences or any meetings at all because of the virus. We have to rearrange everything.” The coronavirus’ potential disruption of business may have an impact on crypto prices, as professionals such as Wu are concerned.
The Lunar New Year started on Jan. 25 this year, during the winter flu season. Wu added, “The market might take a heavy blow if the money stops flowing into these crypto asset classes as it usually did before. The outbreak happens to be at the end of the cycle. We are not sure when and how much money would come back after the holiday.”
Image via Forbes