The news of euro-dollar parity favors Bitcoin and has roiled the markets. Many fear an economic recession in Europe. However, the sharp drop in the European currency is good news for cryptocurrencies, especially Bitcoin.
The 1:1 parity between the dollar and the euro comes at a very complicated time for Europe. The so-called "Old Continent" is facing a serious energy crisis, as a result of the sanctions imposed by the bloc on Russia, due to the war in Ukraine. Uncertainty over Russian gas shipments continues to grow. Several governments have asked their citizens to save gas; meanwhile, fuel prices continue to rise. Inflation is already a global phenomenon.
Cryptocurrencies are struggling at the moment as well. The value of most cryptocurrencies has plummeted. Eight months ago, Bitcoin peaked at $72,000. It is currently below $20,000. However, according to experts, the euro crisis could favor Bitcoin in the long term.
Arthur Hayes, a reputed specialist, stated that the price parity between the dollar and the euro is evidence that the traditional market has begun its " Doom Loop".
"The Doom Loop has begun. 1 dollar = 1 euro. Get ready for YCC and BTC = USD 1 million. But be patient, these things take time," Hayes acknowledged, in a tweet that has generated a lot of controversy.
Not everyone agrees with Hayes. However, in a context of devaluation of fiat currencies, galloping inflation, with record figures in the United States, Canada and Europe, investors are once again looking towards cryptocurrencies. They now see them as a possible lifeline. For many of these investors, cryptocurrencies continue to be the best financial instrument to safeguard their assets.
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