Written by: Lior Yaffe. Lior Yaffe is Co-Founder and Director of Jelurida, has 20+ years of experience in design, development, and deployment of enterprise applications for large organizations. Lior has his B.A. in computer science from the Technion in Haifa, Israel.

Before establishing Jelurida (the company powering Nxt, Ardor and Ignis), he led the development and product management of a leading mainframe integration product at Software AG.

Anyone watching the news over the last few weeks would be forgiven for thinking we’re right in the middle of some kind of apocalyptic nightmare. Every single news channel seems to have a ticker of live events, recording cases, and mortality in real time.

Words like “self-isolation” and “social distancing” have become part of our everyday vocabulary. In many countries, citizens are virtual prisoners in their own homes, only allowed out for a limited time each day at the order of their governments.

I’m not an expert in public health care or macroeconomics. But as someone who has been paying attention to these events as they’ve unfolded, one thing appears evident.

The Coronavirus Is Not Going to Destroy Humanity.

As difficult as it may be to imagine from watching the news, it won’t even come close.

Governments have stepped in, and the measures being put in place are proving to be effective. China, where the outbreak originated, is already starting to lift the restrictions it put in place. South Korea has been hailed as “exemplary” in its handling of containing the virus.

Eventually, this disease will go the way of the Dodo. Sooner or later, researchers will produce a vaccine just like they did for smallpox, polio, measles, and countless other horrible diseases that used to decimate our populations.

What Does Coronavirus Mean for the Blockchain Space?

In the long-term, it’s likely that the objective effect of the coronavirus on the operation of blockchain protocols and the work of blockchain developers is going to be negligible. As long as there’s electricity and an internet connection, blockchain protocols can continue to operate irrespectively.

Furthermore, speaking as a blockchain developer, I’m so used to working remotely that being quarantined isn’t really noticeably different from any other working conditions.

With this perspective in mind, there isn’t any reason for those in the blockchain space to panic about development being interrupted by this coronavirus.

But What About the Financial Viewpoint?

Of course, the economic impact of coronavirus is reverberating around the globe right now, and the crypto markets haven’t proven to be quite as uncorrelated as we thought they might be. The price of Bitcoin took a beating in mid-March as the stock markets fell, but there are already positive signals of a rebound.

But the question is, after investors panicked and sold every last share, bond, or coin, what are they going to do with all that cash?

On March 15, the US Federal Reserve slashed interest rates to zero. So, anyone who puts their cash in the bank will stand to gain precisely nothing. It’s a steep drop in expectations for those who were previously expecting alpha from their portfolio.

The Ghosts of Finance Past

Those who choose to keep cash in the bank also have the specter of the global financial crisis looming over them. Remember, “Chancellor on brink of second bailout for banks” was the headline in The Times on January 3, 2009 – the day that Satoshi Nakamoto mined the Bitcoin genesis block.

The headline alluded to the fact that several UK banks were on the edge of collapse as a result of the financial crisis. If the economy gets worse as a result of the current crisis, there’s a chance that the bank may once again become a risky place to keep your money.

If it comes to another bailout situation, it will be a clear indication that the banks learned nothing from 2008/2009. Once again, governments will be forced to dilute the value of citizen’s own money to save the companies that wasted their reserves on stock buybacks and bonuses.

It was from such a scenario that cryptocurrencies were born, so if it arises again, it’s only logical that people will once again turn to crypto as a means of bypassing the banking system. Even so, people continued to adopt blockchain and cryptocurrencies long after the threat of the financial crisis had abated.

Digital assets have a limited supply that can’t be manipulated by politicians or bankers. Rather than being pegged to the self-interest of the elite few, tokens are pegged to the efforts and expertise of cryptographers, mathematicians, and software developers. Investors have the opportunity to maintain or even grow their purchasing power, independently of any middlemen.

Furthermore, investing in cryptocurrencies isn’t a zero-sum game. Many people choose to trade or hold digital assets as part of a more diversified portfolio.

The Societal Perspective

I honestly believe it’s too early to estimate the impacts of the coronavirus on broader society. It appears as if it’s the black swan that everyone knew was coming, but was too afraid to admit. Based on what we see right now, the economic and health effects combined could lead to big societal changes that may reverberate into the remainder of the 21st century.

In the best-case scenario, coronavirus may unite citizens behind functional governments that they can trust to act in their best interests when the worst threats come to fruition. In the worst case, the outcome of this crisis will result in a decline towards extremism and societal chaos unseen in the last century. I sincerely hope it’s the former. But either way, I’m certain that blockchain and digital currencies have a role to play in the technological and financial landscape of the future.

Featured image via Pixabay.