March 2020 was a brutal month for capital markets. Traditional equity markets saw global losses surpass $12 trillion, with commodities and cryptocurrencies also seeing their own seismic drops in valuation.

At the epicenter of all this financial turmoil is the Coronavirus pandemic. The virus has so far led to more than 1.3 million reported cases, over 75,000 deaths and social lockdowns across the globe.

In this March 2020 focused analysis, we take a closer look into how far crypto and traditional markets fell, which assets have so far bounced back after the crash, and finally, which investments have managed to survive the market meltdown.

The month capital markets collapsed

In the third month of the new decade, financial markets crashed in unison around the world. While Bitcoin fell by a quarter, other global assets like crude oil (-54%) and the S&P 500 (-13%) also saw crippling losses as the first pandemic in decades was priced into capital markets.

March Low: Lowest traded price in March

Looking at the red bars—showing just the percentage drop in price from March 1st to the March low—Bitcoin together with crude oil saw a 50%+ correction to the downside, with the S&P also dropping by 25% over the month.

March Bounce: Price change between the March Low and the highest traded price before 1st April



However following the panic-fuelled market crash, markets did also bounce back by the end of March. Bitcoin in this category led the way, seeing its price appreciate from a low of $3,900 to hit a high of just under $7,000 according to data from the Kraken Futures – Real Time Bitcoin Index.

The 79% bounce for the biggest cryptocurrency was also matched by Ethereum (+71%) and to a lesser extent by crude oil (+32%), and the S&P 500 (+19%). As markets rallied, even gold saw a 13% move to the upside, after only falling a modest 7%. Gold seemed to be the only good news in a sea of double-digit declines as the COVID-19 contagion spread.

Comparing losses by market capitalization

Even though the carnage in crypto markets looks bad compared to other traditional market losses, the various market capitalization changes for each asset paint a much different picture.

Given that Bitcoin and many other cryptocurrencies derive part of their value based on their limited supply and digitally verifiable scarcity, we focus a lot on market cap figures in crypto.

For example, Bitcoin’s market capitalization in US Dollars is calculated by multiplying its USD price by its current circulating supply. At present, around 18.3 million (or 87%) of the network’s total supply of 21 million coins has been mined into circulation. This amount of circulating coins on the network gives Bitcoin a current market capitalization of just over $133 billion based on a $7,300 BTC price.

In traditional markets, market capitalization is barely mentioned. Although market cap can apply to equity based assets, there is not a set methodology to evaluate market cap for all financial products. When analyzing some traditional assets like commodities or government-backed bonds, it is sometimes difficult to work out the total supply, issuance, or the value of underlying assets.

Nevertheless, looking at a recent monthly report produced by the World Federation of Exchanges (WFE), total market capitalization losses hit a record $12 trillion for the month of March 2020.

Over 84 exchanges they track, WFE reported that they had seen global “equity markets” drop from $92,642,733,420.000 at the end of February to $80,446,052,110,000 by the 31st of March.



The $12 trillion fall was the biggest monthly drop reported by WFE since global equity markets lost $3.7 trillion in July 2019. However, since the July drop, equity markets had recouped all those losses as global market cap rallied to a new all-time-high of $94.4 trillion by the end of November 2019.

The biggest single equity index on the WFE list and in the world is the S&P 500. According to data from Business Insider, market cap losses over the month of the COVID-19 fueled selloff amounted to $3.5 trillion. This took the index that tracks the 500 biggest publicly listed corporations in the United States from a March 1st market cap of $25.9 billion to $22.4 billion by the end of the month.

To put that loss into perspective, the drop for just the S&P was 88 times larger than the $39 billion drop for Bitcoin in March.

Oil market cap calculated using the annual barrel production in 2019 of 29 billion.

For this market cap focused study, we also looked to compare the drops for other fixed supply commodities like oil (with a market capitalization estimated by one-years worth of production) or gold that has a reported supply of 171,300 tonnes.

In comparison to Bitcoin and the S&P, crude oil saw its market cap drop $700 billion in March, whereas gold actually saw a modest market cap appreciation of just under 1% or $84 billion.

What did we learn from the March sell off?

Looking over the market carnage—both in terms of price and market capitalization changes—it looks like we learnt a few things from the March 2020 drop.

Firstly, gold survived the crash and in fact rose in value in March. Demonstrating its safe-haven credentials, gold experienced relatively low amounts of volatility, given its weighty global market cap of around $10 trillion.

Next, although Bitcoin did fall and bounce in line with other global assets, Bitcoin’s market cap change in nominal terms shows just how undersized the now decade old asset is. With trillion dollar sums moving around capital markets in a matter of days, even just a fraction of this re-settling into Bitcoin would have a major impact on its market cap.

And finally, when traditional markets go down, and the bill to save the world is reported at $7 trillion and rising – it is near enough inevitable that the central bank money printers will soon be going Brrr.

It’s a crazy world out there – stay safe traders.

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