- Bitcoin is taking an active part in the riots across America.
- People are protesting since last week over the death of George Floyd, a black man who died while pleading for air as a white Minneapolis officer jammed a knee into his neck.
One protestor in the Los Angeles neighborhood talked about opting out of the current scenario by moving into bitcoin. He said,
“We live in a system that will not allow us to thrive. […] My macro solution for everyone is to opt out and exit the economy as a whole and the way we do that is by buying bitcoin.”
“Who is this masked hero?” enquired Jesse Powell, founder and CEO of cryptocurrency exchange Kraken on Twitter.
The protests erupted only recently but it needs to be pointed out that in the first five months of 2020, things weren’t going well either. People were under lockdown due to the coronavirus pandemic that resulted in unemployment soaring to nearly 24% with jobless claims since mid-March at a staggering 40.8 million.
While people are struggling to fed their family and pay their rent and mortgages, US Federal Reserve printed money and stocks are flying.
The disconnect between the economy and the financial markets is now the greatest it’s been since ancient Rome.
— Mati Greenspan (tweets are not trading advice) (@MatiGreenspan) June 4, 2020
This wasn’t the first incident of bitcoin being highlighted during the protests either.
Earlier this week, another protester in Dallas carried a sign saying “Bitcoin will save us,” much to the ire of the people both from inside and outside the crypto industry.
Another one has been in Raleigh, North Carolina, where the poster of the protester read “Bitcoin & Black America” referring to the book authored by Isaiah Jackson.
#Bitcoin is the peaceful protest.
— CZ Binance 🔶🔶🔶 (@cz_binance) June 1, 2020
Crypto industry has also been sharing its solidarity to the cause with Ripple CEO Brad Garlinghouse supporting those “who are fighting to save Black lives,” although he “can’t ever fully understand the pain of our Black community that recent and past events have caused.”
Bitcoin has been a part of protests in other parts of the world as well. Last year, the pro-democracy movement in Hong Kong supported the adoption of the digital currency. Also, in countries like Venezuela, Argentina, Chile, and others, cryptocurrencies played a role.
Markets Rising amidst the Chaos
For the first time in about a month, this week the price of bitcoin also jumped above $10,000 amidst the raging protests, although we are back to $9,500.
But bitcoin isn’t the only one, while many cities are on fire in the US, the S&P 500 enjoyed its greatest 50-day rally in history while struggling with the coronavirus pandemic.
If history is any indication, these 37.7% returns would further expand in the days ahead.
The #GeorgeFloyd protests have had zero affect on the stock market.
Here’s a graph of the Dow Jones index since #GeorgeFlyodMurder. As you can see, it just keeps going up.
The poor are in pain, the country is on fire, but the rich keep getting richer. pic.twitter.com/TYDiy09paS
— Mati Greenspan (tweets are not trading advice) (@MatiGreenspan) June 3, 2020
The reason behind this disconnection between the stock market and the economy is the trillions of dollars injected into the market by the Federal Reserve and government. Trader and economist Alex Kruger said,
“Europe sharply reducing political tail risk, Japan fiscal package 40% of GDP, China fears overdone as Trump steps back, economies reopening, US riots The market has spoken. Hence why so much green.”
But the widespread civil rest in the US could act as a headwind for stocks. Currently, bitcoin is trading at above $9,600 and is expected to hit $20,000 this year.