We’re happy to share that in the last week of March we saw the volume of Bitcoin traded through our app increase by almost 1,000% compared to our average weekly trading volumes up until March. Ninety per cent of these trades were purchases.
Our surge in trading activity was immediate after two main events that took place last month; the global markets crash at the beginning of March and the UK’s official lockdown announcement due to COVID-19 on March 23rd.
Following the markets crash, our users reported Bitcoin as having been undervalued and strongly believed this was a good ‘buying’ opportunity. Global markets saw a sell-off of almost 30% in the first weeks of March and Bitcoin saw a decline of around 50%.
The week after the UK went officially into lockdown, we saw our biggest spike in trading activity, and we believe one reason for this could be that people had more time to think about their future and their investments and look for ways to diversify their portfolios.
There are two other factors that could also be fuelling this positive sentiment amongst investors. Firstly, the impact of Coronavirus aid packages and monetary stimulus programmes. Trillions of dollars have been pumped into economies and stock markets around the world. This has been causing longer-term concerns about the US dollar and other currencies becoming debased, and inflation rising. The nature of Bitcoin means that quantitative easing and other monetary measures do not directly affect its price and thus it can be used to hedge against the impact of these on fiat currencies.
Secondly, the halving of Bitcoin that takes place next month. The number of Bitcoins entering circulation will drop by half which some market commentators and investors believe will drive up the cryptocurrency’s price.
UK Weekly Traded Volume – Mode
(compared to average weekly volume)
Our Head of Marketing and Communications, Ariane Murphy said: “The price of Bitcoin really rallied in the second half of March and we saw a significant surge in people wanting to buy and hold Bitcoin through our app.”
“But not only that, with the launch of our new interest-generating Bitcoin Jar less than 2 weeks ago, we’ve seen 70% of the Bitcoin held via our app being switched from users’ Bitcoin Accounts into their Jars in order to benefit from our current 5% APY offer. We believe that this move shows that investors are in for the long term and want to make the most of their assets while holdings them.”
It is difficult to pinpoint the exact reason that is driving this sentiment, but we hope that it keeps growing and that we continue to see more people access the Bitcoin markets in the future.
In terms of the current Coronavirus situation, we acknowledge that this is a very difficult time for many businesses and individuals out there, and in order to show our support to the cause, we will be donating to the UK’s National Healthcare Service very soon. We will disclose more details about this in due course.