Bitcoin value drop linked to escalation of Russian aggression against Ukraine

29 January, 09:50 AM
Bitcoin value drop linked to escalation of Russian aggression against Ukraine (Photo:New York Post)

Bitcoin value drop linked to escalation of Russian aggression against Ukraine (Photo:New York Post)

The recent drop in the value of the Bitcoin cryptocurrency has been linked to political tensions between Russia and Ukraine, news agency Reuters has reported, saying that investors are dumping risky assets like Bitcoin in response to potential instability.

Mark Elenowitz, president of Horizon, a securities services company, explained the fall in Bitcoin to Reuters.

“Bitcoin will face resistance until macroeconomic conditions change… When rates rise, we may see more selloffs in seemingly risky assets like Bitcoin,” Elenowitz said.

NATO officials on Jan. 24 announced that they were putting their forces on high alert, and reinforcing Eastern Europe with additional ships and fighters due to fears of an invasion of Russian troops into Ukraine.

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That same day, bitcoin’s price dropped to $33,200 per coin, the lowest it’s been since July 2021, when the Chinese authorities announced a ban on the mining of digital assets.

On Nov. 10, 2021, the market capitalization of all extant cryptocurrencies reached an absolute maximum of around $2.969 trillion, while Bitcoin at that time was trading at a record $69,000.

By the end of the year and at the beginning of 2022, the situation changed dramatically: both the total market capitalization and Bitcoin’s price has fallen by a factor of two. Key indicators, used to predict the trend of crypto prices, have all fallen back to levels comparable to the summer of 2021.

As of 2330 on Jan. 27, Bitcoin was trading at $35.700.

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