Deutsche Bank: Four scenarios more devastating than Coronavirus pandemic and at least one could put an end to Bitcoin
While the world economy is trying hard to recover, Deutsche Bank said it is likely that the disaster will be much worse than the COVID-19 pandemic in the next ten years. In particular, there will be at least one scenario that can end the Bitcoin era.
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There is a one-in-three chance of an event even more devastating than COVID-19 pandemic in the next decade
It was thought that Bitcoin Halving 2020 would be a factor to save Bitcoin and the cryptocurrency market from the prolonged bear market trend. However, a black swan event appeared with a sudden pandemic outbreak. This has caused the market to decline, and investors are bewildered about the worst possible outcome. Unemployment skyrocketed, and stimulus money was printed left and right to save the economy from a recession that is shaking the market.
The stock went from setting an all-time high to a quarterly close with the worst losses on record. Bitcoin price plummeted from over $ 10,000 to under $ 4,000.
However, these disasters are nothing compared to a potential disaster that Deutsche Bank warned could come in the next decade. This disaster can completely kill Bitcoin and most other forms of electronic payment.
So, what is the scenario that could kill Bitcoin?
As soon as the Coronavirus pandemic occurred, it caused a drastic change in the functioning of businesses and digital payments. As a result, digital payments have grown. Even VISA says there has been an increase in adoption in Latin America, where people are making their first digital purchases when stuck at home.
In some smaller areas that lack a banking infrastructure, Bitcoin is well serving this role. But that resistance may not make sense if one of the four scenarios Deutsche Bank says has one of three chances within the next ten years. Any of the four scenarios is far crueler than the current pandemic – and looking at the impact it has caused.
Among the worst cases, Deutsche Bank predicts a major flu pandemic, global war, a catastrophic volcanic eruption worldwide, or the worst for Bitcoin, a solar fire.
The report stated:
“The most significant risks include a flu pandemic killing more than 2 million people, a global catastrophic volcanic eruption, a massive solar flare, or global war. A significant flu pandemic was seen as the most likely catastrophe, with a 2% chance of one occurrence in any given year. ”
The report added:
“A severe solar storm hasn’t hit the Earth since 1859, but it was rated as the second most likely disaster, with a 1.06% annual chance. There could be significant power outages as electrical power grids are disrupted, which in turn would have knock-on effects throughout the economy as critical infrastructure is unable to be run properly. An eruption on the scale of the 1815 eruption of Mount Tambora in Indonesia, which caused worldwide crop failures during the Year Without a Summer, was given an 0.15% annual chance of occurrence. ”
Analysts acknowledged that the chances of global war are harder to predict. Still, they said a conservative assumption would be 0.625% annually, meaning about a 25% chance of a world war within the next 40 years.
Deutsche Bank says that this is even more likely than another war, also as US and Chinese tensions have simmered in recent weeks and repeatedly pointed out who is responsible for the current pandemic.
Deutsche Bank stated:
“There could be major power outages as electrical power grids are disrupted, which in turn would have knock-on effects throughout the economy as critical infrastructure is unable to be run properly. Lives could be lost if it impacted hospitals and medical care. Communications would be disrupted, many payment systems would be dysfunctional, and GPS [Global Positioning System] satellites would face extensive interference, to the detriment of all the individuals and industries that rely on accurate location services, not least aircraft.”
With such a disaster, Bitcoin is likely to be the least worry of everyone. However, all knocked-out power across the planet will destroy most of the payment infrastructure, including Bitcoin. No transactions can be sent, and miners will not be able to operate the machines needed to maintain the network.
Read more:
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- Bitcoin Price Has Shown Some Signs Of Being Correlated To The Stock Market Over The Past Few Months