ANTICIPATED CRYPTOCURRENCY BULL RUN EFFECT ON THE REAL-WORLD.
The cryptocurrency world is full of surprises and a high level of uncertainty both on apparent and unforeseen circumstances. This we believe to be contingent upon the fact that the system is yet to be fully harnessed as to function like every other security or asset although a good number of Investors are flooding into the system on a daily basis.
Consequently, we can't fade the fact the bull run is at the corner. Every crypto based community both those in web2 and folks in web3 are all clamoring for the bull run. The last experience of the bull run was so deserving but later fizzled away and the whole system went down as though we never experienced the bull run.
Sincerely, the question I wouldn't stop asking is why the cryptocurrency world should solely depend on Bitcoin halving in order to create an effective bull run even at the existence of the crypto whales. On the other hand, I observed that Bitcoin halving mechanics is an irrefragable measure which reduces the emission and flooding of the crypto market by miners while whales are mere investors that are bent on consistent shorting of the market for profit although they don't act in unism since there is no group for all the whales where opinions and decision are made.
However, given the anticipated halving slated in April 2024 which will lead to a stronger bull run in response, there are some real world scenarios it'll create in effect which I intend to unriddle through this publication given the past three consecutive experience in the Bitcoin halving although the impact at this time will be more intense than what was obtained in the past.
The next bull run that's set to take place on account of the next BTC halving will create a lot of disequilibrium in the real world. However, let's observe some of these effects below.
It will lead to deflation.
Deflation as we know is an economic scenario that takes place as a result of an insignificant volume of money going after plenty of goods in the economy. However, during the envisioned bull run, there will be a high level of deflation given the fact that the cryptocurrency invention has become a global trend with so many wooing features. On the other hand, the prices of goods and services in the physical world will be relatively low as people inject more funds into crypto opportunities with expectation of relative price increase than using their money for the purchase of physical goods.
It will result in scarcity of cash.
As I earlier said, there will be a high volume of cash that'll leave individuals' bank accounts into the cryptocurrency world. As people speculate into this period, they'll hold less cash which validates one of the reasons why people hold money: speculation purpose. I trust this is also one of the reasons why the CBN ordered banks in Nigeria never to use their personal accounts in trading virtual assets against draining the economy of physical money.
As we approach the bull run, folks through their speculative power will prefer to maintain their values in cryptocurrency which is a quasi asset with apparent enticing value rather than holding physical money. Consequently, this will create a malignant effect on countries that haven't fully adopted the cashless policy since there is the tendency that people wouldn't invest all to stay hungry as there will be periods they'll sell to have something for upkeep but the bull run in essence will lead to scarcity of cash in different economies.
Increase in GDP and crypto project adoption.
The GDP of a country is an acronym for gross domestic product which accounts for its total monetary product within the domestic economy excluding its income from abroad. However, there are countries that have adopted the use of cryptocurrency within their regions like: China, Israel, Slovenia, Malta, Portugal etc nonetheless, the bull run period will be a period of massive returns into their domestic account. Given this, it will further woo and also compel other countries to also adopt the use of cryptocurrency.
Launching of cryptocurrency related projects.
This will be a good time for crypto project developers. During this period, we will be experiencing a massive increase in the rate developers launch their projects which has been delayed in the course of the bear market. Consequently, this will attract investors and folks of interest in participating in those projects either through airdrops, presale, ICO, IEO etc as to enjoy its dividends accruable from those projects.
Decreased Physical Investment.
What attracts investment is the rate and ratio of returns from every project. However, given the increase in cryptocurrency price within the periods of bull, Investors will be lured by default to invest and manage their asset in crypto rather than investing in physical opportunities. Consequently, as physical Investment decreases, it will further lead to unemployment although this is contingent upon the length of period the bull run will linger because employers who probably invested into cryptocurrency wouldn't have enough physical cash to credit their employees unless they should make a withdrawal of their stakes from cryptocurrency.
It will lead to increased physical Investment.
Although this seems to contravene the points above, it's not. The effect of the bull run will lead to an increased physical Investment after the period elapses and Investors on the other hand have withdrawn their money from crypto. However, the interest and returns accumulated during the bull run will be used for physical Investment which will further lead to an increase in people's already level and positions of physical injection.
It's now apparent through the explanations above that the anticipated bull run will have a real world effect although a dual effect which isn't so bad from observations. Consequently, it will be lovely to maximize the benefits that will accrue at this period by accumulating the much you could based on your financial capacity before the dominance of the inevitable bear market that will set in after the bull run. Thank you for going through.
Posted Using InLeo Alpha
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