Abstract

In this study, we explore how and to what extent economic crises, especially the current COVID-19 pandemic, have affected the investment dynamics of cryptocurrencies. The results found with cryptocurrency stationarity and characteristics such as Augmented Dickey-Fuller and Phillips-Perron analysis established the fact that cryptocurrencies get affected easily by market fluctuations and demands thus causing certain forms of non-stationarity during the time of the COVID-19 pandemic. Nonetheless, the evaluation highlights serious hazards to trading in cryptocurrencies particularly for inexperienced traders during a time of economic uncertainty. According to the study, while seeking to invest in the future of digital currencies, investors need to balance their portfolios with the current conventional funds to help them minimize risks while at the same time maximising their returns by diversifying into the new innovative digital currencies. In addition, the study notes the importance of quality regulation and investor awareness to deal with the issues of cryptocurrency investment. The research brings insight into the debate as to whether cryptocurrencies are still efficient investment instruments during global v