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by Tor Constantino | Published on Nov. 29, 2021
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A new potentially deadly COVID strain gets named and an existing cryptocurrency with the same name rockets to life -- talk about an unintended consequence!
On Black Friday, stock markets and cryptocurrencies alike plunged into red after the World Health Organization (WHO) identified and named a new COVID-19 variant -- omicron. The newly discovered and named strain was first detected in South Africa, and during the past 72 hours, additional cases of omicron infections have been found in more than a dozen countries including Australia, Denmark, Netherlands, Israel, and Canada.
There is a lot of worry and concern about whether or not existing COVID vaccines and treatments will have any effect on this latest version of the virus. It's also unclear to global health experts, researchers, and physicians if omicron is more infectious and/or deadly than other mutated iterations.
Ironically, the price of a relatively-unknown small cryptocurrency -- which also happened to be named Omicron (OMIC) -- soared more than 450% since the WHO named the new COVID-19 strain. As of Friday, the crypto Omicron was trading around $50 per token, but it reached an all-time high of $431.69 as of 9:18 a.m. ET on Sunday per its chart posted at CoinMarketCap.com.
Since that parabolic price spike, Omicron has retracted a bit and is down about 16% during the past 24 hours, with a fully diluted market cap of $328 million as of this writing. The OMIC token is described on CoinMarketCap as a "decentralized reserve currency protocol available on the Arbitrum Network...Each OMIC token is backed by a basket of assets (e.g. USDC, OMIC-MIM LP) in the OMIC treasury, giving it an intrinsic value that it cannot fall below. OMIC also introduces unique economic and game-theoretic dynamics into the market through staking and bonding."
In case you're wondering, the WHO has a specific set of "best practices'' it uses when naming diseases and variants. The global health agency strives to avoid words that invoke fear or link to specific populations, animals, regions, or geographies. Instead the WHO namers prefer terms that focus on the facts and describe clinical symptoms, affected age ranges, severity, seasonality, etc. They also have a specific category that allows the use of "arbitrary identifiers'' such as numbers or the Latin alphabet. This last protocol seems to be what the WHO used to select the omicron name.
While it's pure speculation as to how the OMIC crypto had a record-setting weekend, one can assume that some trader/investor who knew the OMIC token existed took a page out of the meme token playbook. They decided to take a gamble and jump the market by bidding up the price. They then most likely shared the omicron naming news via a network of similarly-minded investors on some kind of instant message or board. Once they reached critical mass, they pushed the message to go viral. Investors who didn't want to miss out piled on to try and make a pile of cash themselves. We'll see how long Omicron can float on the non-fundamentals' fervor.
It's disconcerting to see such arbitrary price action based solely on a name -- especially when you consider it's the name of a potentially more deadly COVID pathogen than we've all been fighting the past 18 months. It appears we may either be becoming desensitized to the viral threat of COVID or willing to exploit nearly anything to make money -- and neither scenario is especially comforting.
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