The price of bitcoin, the most popular and most invested cryptocurrency in the world, fell below the $40,000 barrier after Russian President Vladimir Putin announced the military operation in Ukraine.
Bitcoin fell 2.14% in the last seven days, indicates the CoinMarketCap website, which tracks the cost of the most established digital currencies in the investment market. It was trading at $39,178.52 at 4:00 p.m. (Ecuador time) this Friday, February 25, 2022.
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However, there is a recovery of 1.81% in the last 24 hours, which gives hope to those who invest in these digital assets, since it was trading below $35,000.
This electronic coin reached its maximum amount last November at $68,990, but has since dropped below the $40,000 barrier, a 50% reduction of the largest cryptocurrency by market value.
Analysts argue that the rise in interest rates by the United States Federal Reserve and the restrictions of some major economies on these digital assets affected their price.
India has recently announced a 30% tax on virtual digital assets, maintaining its reticence towards them and betting instead on the digital rupee.
Added to this is the geopolitical situation this week with Russia’s invasion of Ukraine.
Japan, by contrast, launched its first phase of testing a digital currency last year while continuing to allow cryptocurrency transactions.
For its part, Singapore, which is also considering creating its own electronic currency, has granted five licenses to cryptocurrency services, but has warned against their advertising for being “highly risky” given its proclivity for speculation, a position similar to that of Spain.
Other cryptocurrencies also fell after Putin’s announcement.
Ethereum has plunged 3%, according to CoinMarketCap, in the last seven days and is trading at $2,713.14 as of 4:00 p.m. this Friday, February 25.
Theter and BNB also register reductions. The first has a marginal fall and the second is trading 8% less, also in the last seven days. A theter is trading at $1 and BNB at $368.8.
Edward Moya, senior market analyst for the Americas at Oanda, said in a note to clients last Thursday that many investors “are hesitating to increase holdings given the tremendous uncertainty for risk assets,” according to Cnn in Spanish.
Moya predicted that bitcoin will likely continue to “see decent resistance from the $40,000 level as geopolitical tensions will prevent risky assets” from rising much.
Gold remains the safest investment metal amid current circumstances, analysts say, just as it was during World War II. A return to the traditional.
The fall in cryptocurrency prices amid the turmoil in Ukraine, Bloomberg reports, undermines crypto advocates’ argument that cryptocurrencies are now the digital version of the long-time haven asset.
“Bitcoin is much more of a momentum and risk-driven asset than the independent store of value that people want it to become, it just isn’t there yet,” said Tom Essaye, a former Merrill Lynch trader who founded The Sevens Report. , as reported by Bloomberg.
Gold traded as high as $1,974 on February 24, the highest since September 2020, a year marked by the start of the COVID-19 pandemic.
“Gold is doing exactly what it should be doing right now, but it’s a much more mature asset and it has a proven track record in these kinds of conflicts of how it’s traded,” Essaye said. “This is the first time bitcoin has faced a potentially major global conflict, and I would expect the declines to continue as long as stocks are under pressure.”
In a dialogue with AFP, market analyst Diego Morín assured that if bitcoin reaches $33,076, the last minimum, it is very possible that it will drop to the $30,000 barrier. “Now it is too early to know what will happen to cryptocurrencies with the current crisis, as well as than with the rest of the assets, since the uncertainty could continue to create a selling panic, but everything will depend on the performance of the process carried out by the countries involved”, explained the expert. (I)
Source: Eluniverso
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