Once again, the cryptocurrency market finds itself serving as a mirror to societal trends. Indeed, shortly after the revelation of the appearance of the new Omicron variant, a cryptocurrency with the same name underwent an exceptional gain in value.
Crypto market affected by new Covid variant
Since November, the world has been on alert since the discovery of SARS-CoV-2 variant B.1.1.529, or Omicron. First known as Nu before being named by the World Health Organization (WHO), this new variant has also impacted the cryptocurrency industry. Indeed, the market reacted quickly, and the famous Bitcoin has rapidly lost value since the appearance of this dangerous, potentially more vaccine-resistant variant.
This is what Yuya Hasegawa market analyst at Bitbank explained to Reuters: the spread of Omicron could potentially reduce investor appetite, and the market will face further losses. Not an abnormal situation in the crypto world: those familiar with the industry know how volatile cryptocurrencies can be. In addition, the appearance of the variant also represents a new opportunity for other currencies to make themselves known. This is what happened with the Omicron currency! Indeed, while Omicron was trading around 65 dollars on Saturday, November 27, the token was worth up to 689 dollars this Monday morning. a growth of almost 950%!
Is the Omicron token a scam?
Cryptocurrencies gaining popularity are often linked to current phenomena. We remember the Squid Game token, inspired by the Netflix series of the same name, which turned out to be a huge joke!
However, Omicron does not seem to be a scam. In fact, the token is one of many clones of Olympus DAO, a decentralized currency reserve project. Thus, Omicron already existed long before the discovery of the homonymous variant! Nevertheless, the project is quite recent. In fact, according to data from the Who Is site, the Omicron site was registered on October 25, 2021. No wonder the sudden explosion of this cryptocurrency has caused so much distrust.
A sudden increase… too sudden
On November 29th, Omicron was the 5th most bought token on SushiSwap. But this sudden increase can be dangerous. This is the law of the market: the more requests and tokens created, the more the value of the currency increases. However, such a rapid increase, linked to current events, does not mean that there will be growth in the long term. The risk of a bubble is therefore significant, which means that Omicron could suddenly lose its value overnight.
In fact, barring another marketing stunt, it’s likely that Omicron will return to obscurity once the buzz wears off, like so many other cryptocurrencies. So it goes without saying that investing in this currency seems quite risky!