Jason Wu had to cancel a dozen meetings with his crypto clients in China after the coronavirus epidemic broke out this month.

“We planned a 10-city tour to talk with potential clients in China,” Wu, the CEO and founder of non-custodial crypto lender DeFiner, said. “Nobody wants to attend any crypto-related conferences or any meetings at all because of the virus. We have to rearrange everything.”

Since the first patient was identified on Dec. 8 in Wuhan, the capital of Hubei province in central China, the virus has claimed 80 lives. There were nearly 2,000 confirmed cases as well as 10 cases abroad, including five in the U.S. as of Sunday evening.

Given China’s status as a crypto investment hub – it has the most exchanges in the Asia-Pacific region, which in turn has 40 percent of the world’s top 50, according to research firm Chainalysis – professionals like Wu are concerned, to varying degrees, about coronavirus’ potential disruption of business and the impact on prices.

Wu said marketing events are crucial for underground crypto investment firms in China to raise money and invest in digital assets, and they are likely to slow down due to the virus.

“The market might take a heavy blow if the money stops flowing into these crypto asset classes as it usually did before,” Wu said.

While Wu could not estimate how much money Chinese investment has brought into the crypto market, he cited PlusToken, one of the largest illicit crypto firms, as an example.

The defunct company gained its notoriety among Chinese crypto holders by raising over $3 billion through a Ponzi scheme. It attracted 789,000 ether, 26 million EOS and 200,000 bitcoins, which is equal to one percent of the outstanding supply. It was shut down by the Chinese government in June 2019.

Besides the virus outbreak, the crypto market could be hit with a double whammy with the Chinese New Year, according to Wu. Many Chinese crypto retailers tend to cash in on cryptocurrencies right before the holiday and reinvest in the market in the next year.

The Chinese New Year fell on Jan. 25 this year.

“The outbreak happens to be at the end of that cycle,” Wu said. “We are not sure when and how much of the money would come back after the holiday.”

Murky market

While Chinese crypto investors are a considerable market force, it is statistically difficult to conclude a one-to-one correlation between the outbreak and moves in the crypto market, said Lingxiao Yang, chief operating officer at Trade Terminal, a Silicon Valley-based crypto hedge fund.

“It is really hard to single out one reason that affects crypto trading volumes and market prices, given the data is not always available and transparent in the first place,” Yang said.

Furthermore, the whole market cap of cryptocurrencies is small compared to the stock market, which means many factors could make an impact on the market.

However, Yang described a few traits of Asian crypto investors that could make the coronavirus a significant factor to influence the market.

Most crypto investors from Asia tend to be retail investors, and historically they became more active around major holidays such as the Chinese New Year, Yang said.

“We can’t predict the market prices, but based on our past experiences it tended to get more volatile around those times,” Yang said. “I can see the virus outbreak could potentially lead to more crypto trading for retail investors since they would just stay at home and have even more time to check the market.”

It is also difficult to predict market prices as digital assets like bitcoin have a unique set of return drivers, said Kostya Etus, a senior portfolio manager at money management firm CLS Investments.

“Bitcoin isn’t really viewed as a safe-haven asset like gold or cash and it doesn’t have much in common with risk-on assets like stocks either,” Etus said. “While most assets are specific to risk-on and risk-off environments, in which you could predict price reactions to certain events, bitcoin is not one of those assets.”

Fluid situation

Since crypto is highly speculative, the coronavirus could conceivably have a significant impact on the global market, according to Samuel Lee, a financial advisor at Chicago-based SVRN Asset Management.

“The crypto market might overreact to the outbreak since it tends to be irrational compared to the traditional financial market,” he said.

On the other hand, Lee said the outbreak is more likely to have a limited effect.

“We have seen bitcoin as an asset class went up at the same time when there was the possibility of a war between Iran and the U.S.,” Lee said. “However, the coronavirus might not be that big of a geopolitical influence.”

The World Health Organization (WHO) is still debating whether to declare the outbreak an international public health emergency as of the time of writing.

“Chinese residents are not scared enough that they want to flee the country,” Lee said.

The S&P 500 turned positive even after WHO summoned an emergency meeting on how to tackle the coronavirus outbreak, although Hong Kong’s benchmark Hang Seng Index and Shanghai A Shares Index have experienced sizable dips recently.

“Most previous regional epidemics appear to have had very limited impact on the equity market, except for Severe Acute Respiratory Syndrome (SARS),” said Wilfred Daye, a senior advisor to boutique investment bank Bardi Co. SARS is an aggressive viral respiratory illness caused by a similar strain of the new coronavirus.