Safe Haven or Risky Hazard? Bitcoin during the COVID-19 Bear Market

14 Pages Posted: 27 Mar 2020 Last revised: 18 May 2020

See all articles by Thomas Conlon

Thomas Conlon

University College Dublin

Richard McGee

Smurfit Business School

Date Written: March 24, 2020


The COVID-19 bear market presents the first acute market losses since active trading of Bitcoin began. This market downturn provides a timely test of the frequently expounded safe haven properties of Bitcoin. In this paper, we show that Bitcoin does not act as a safe haven, instead decreasing in price in lockstep with the S&P 500 as the crisis develops. When held alongside the S&P 500, even a small allocation to Bitcoin substantially increases portfolio downside risk. Our empirical findings cast doubt on the ability of Bitcoin to provide shelter from turbulence in traditional markets.

Keywords: Bitcoin; Safe Haven; Downside Risk; COVID-19

JEL Classification: G10, G11

Suggested Citation

Conlon, Thomas and McGee, Richard, Safe Haven or Risky Hazard? Bitcoin during the COVID-19 Bear Market (March 24, 2020). Available at SSRN: or

Thomas Conlon (Contact Author)

University College Dublin ( email )

Smurfit Graduate Business School
Co. Dublin, n/a


Richard McGee

Smurfit Business School ( email )

Blackrock, Co. Dublin

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