A lot has changed since the coronavirus pandemic swept the globe as it has caused a wide range of negative effects on the world’s economy. On March 30, the blockchain surveillance firm Chainalysis published a report that shows how the cryptoconomy is faring from merchant acceptance to gambling, and darknet purchases as well. The researcher’s study highlights that the covid-19 environment has “brought about a significant change” by impacting crypto-based spending habits.
Covid-19 Effects on the Global Economy Caused a Dip in Bitcoin Spending
On Monday, the blockchain forensics company Chainalysis published a research report that shows the correlation between bitcoin’s price and spending BTC with merchant services, gambling sites, and darknet markets. Statistics from Chainalysis shows that all three spending types “dropped significantly since March 9.” Covid-19 has had an adverse effect on crypto spending and even though the spending habits declined it was in a way that Chainalysis researchers did not expect. The firm says that it is understandable that during an economic crisis, spending usually drops but the company has found that the price of bitcoin is “correlated with daily Bitcoin receiving activity for the services we’re analyzing.”
“Meaning, the amount of bitcoin customers send to those service types in a given day — both before and after covid-19 reached North America,” the Chainalysis report adds. “The level of correlation has changed for each of the service types we’re looking at. For darknet markets, revenue has become more correlated with bitcoin’s price, meaning darknet markets have seen unexpectedly steep revenue declines since bitcoin’s price began to drop.”
The Chainalysis report added:
This is especially interesting considering darknet markets’ revenue previously had a small but significant inverse correlation with Bitcoin’s price,