Bitcoin is located on a screen that shows the exchange rate of Bitcoin – US dollar.
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Cryptocurrencies took a beating on Tuesday as geopolitical tensions over Ukraine rattled global markets.
Bitcoin It sank as much as $36,370 in early morning trading, its lowest level in more than two weeks. Subsequently, the world’s largest cryptocurrency pared its losses, with its last trade dropping 3% in 24 hours to $37,495.
Analysts attributed this decline to the escalation of tensions over the Russian-Ukrainian crisis. Russian President Vladimir Putin on Monday Command troops into two separate areas In eastern Ukraine, moments after declaring their independence.
The move sparked fears of a full-fledged invasion, which sent global stocks down sharply as traders’ appetite for risk waned.
“Bitcoin and cryptocurrencies in general moved in a steady stride with Asian stock indices overnight as Russian-Ukrainian headlines drove price action,” Chris Dick, a quantitative trader at the London-based B2C2 crypto market maker, told CNBC.
“Initially, the sale took place when Putin announced he was ordering troops to Ukraine and then bounced back as the market handled the headlines.”
Bitcoin is often promoted by its proponents as a safe haven asset similar to gold, meaning that it should offer a store of value in times of uncertainty.
However, the case for bitcoin as a form of “digital gold” has collapsed as more institutional investors begin to trade it, and the cryptocurrency has become more compatible with the volatility in traditional markets such as stocks.
Bitcoin is now well below its all-time high above $68,000 reached in November 2021, and some investors believe this is as good as it has been for cryptocurrencies for some time.
Du Jun, co-founder of crypto exchange Huobi, said that the next bitcoin bull market is Not likely until 2024 At the earliest, when the next so-called “half” event is scheduled.
“After this cycle, we will not be able to welcome the next bull market on bitcoin until the end of 2024 to the beginning of 2025,” Du said.
Bitcoin halves the rewards miners receive from the cryptocurrency for verifying transactions, effectively squeezing the supply of new coins in issuance.