Bitcoin Crash! The cryptocurrency lowers its price due to tensions in Europe
Bitcoin began trading on Tuesday with further declines in its price, led by widespread declines in European stock indices.
In this context of global risk aversion accentuated by the escalation in the conflict between Russia and Ukraine, cryptocurrencies are far from behaving as haven assets, which they try to emulate, and move in a similar way to risk ones, Cointelegraph reported. .
On the contrary, traditional haven assets such as gold are gaining ground in these moments of doubt for investors around the world.
Bitcoin traded near a more than two-week low as fears of a possible Russian invasion of Ukraine led some analysts to predict that the largest cryptocurrency could slide towards the key $30.000 level.
The cryptocurrency was little changed after hitting a low of $36.372 on Tuesday after Russian President Vladimir Putin said he is recognizing two self-proclaimed breakaway republics in eastern Ukraine and ordered troops there.
Not only Bitcoin fell. Ether, the Ethereum protocol token, lost as much as 3% on the day before rebounding slightly and XRP plummeted 9% as a result of fear dominating investors.
The most traded cryptocurrency had dipped below the $40.000 level over the weekend and continued to weaken as the Ukraine crisis deepened, undermining the argument that cryptocurrencies are a haven in times of geopolitical turmoil. . At the same time, gold has reached its highest level since June.
“In the latest maelstrom of the world – the US/Russia/Ukraine – Bitcoin, the asset that is supposed to be the answer to all questions, has quietly weakened and is noticeably behind its archenemy, gold,” he said. John Roque of 22V Research in a note quoted by Bloomberg,
Roque predicted that Bitcoin could drop below $30.000 – a level it hasn't seen since July – as traders increasingly lean towards gold, which could push bullion to an all-time high.
Author: MiamiDiario JM 9:22 am