Crypto traders in Asia might not be happiest to read this report
Asia became a hotbed for cryptocurrency adoption following the 2020 COVID-19 pandemic.
In its latest report, the International Monetary Fund (IMF) found that the general cryptocurrency market and the Asian equities market now share a strong correlation that was non-existent before the pandemic.
Before the pandemic hit, the IMF found that concerns related to financial instability in Asia were minimal as the cryptocurrency market “seemed insulated from the financial system.”
However, when COVID-19 hit, Asia saw significant cryptocurrency trading activity as many stayed at home and received aid from the government.
Interest rates around the world were also lowered, which meant people could access credit facilities.
All of these drove the value of the total cryptocurrency market up by 20 times to $3 trillion in less than two years.
Additionally, the IMF found that the cascading impact of the pandemic in Asia led to a growing acceptance of crypto-related platforms and investment vehicles.
Furthermore, the adoption rate of cryptocurrency by retail and institutional investors in Asia who already had positions in the equity and crypto market before the pandemic grew significantly.
Asia, whose general impact in the crypto world went unnoticed pre-COVID, has now become a force to reckon with.
The reason for this is the cryptocurrency trading volume that came from the region became a major source of the global surge in the past few years.
Source: International Monetary Fund (IMF)
According to IMF, as Asian investors increased their presence in the cryptocurrency market during the pandemic, the region’s equity markets and cryptocurrencies, including Bitcoin [BTC] and Ethereum [ETH], developed a stronger correlation in their
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