Crypto Prices bounce back after Drops caused by the Russia-Ukraine conflict

Last Thursday, the global crypto market erased its initial losses from earlier in the day as traders appeared to shake off the Russia-Ukraine crisis.

According to Coin Metrics, Bitcoin’s value grew by 1.7% as Ether gained about 0.2% to trade at around $2,631.50.

Earlier in the day, BTC dropped more than 8%, making the coin worth about $34,702 marking its lowest level in a month and falling below a key support level. Katie Stockton from Fairlead Strategies stated that the drop could exhaust itself within the day and give way to two more weeks of stabilization.

To isolate Moscow from the global economy, President Joe Biden announced that he will introduce sanctions against Russia that limit its ability to do business in dollars, euros, pounds, and yen.

Cryptocurrency prices have slowly become more correlated to movements in other risk assets like stocks, as interest in digital assets increases. Consequently, cryptocurrencies have been put under pressure since BTC hit an all-time high last November reaching almost $69,000.

“The current geopolitical situation will inevitably have an effect on the already elevated prices in the commodities market and aggravate the already-serious supply chain issues which, in turn, could elevate inflation,” said Anto Paroian, chief operating officer at digital asset investment fund ARK36.

“This means that the Fed and other central banks may really have no room to reverse their hawkish course and we can expect risk assets and cryptocurrencies to go deeper into the bear market territory,” he added.

Vice President of corporate development and international at the crypto exchange firm Luno, Vijay Ayyar, said BTC could see a low at around $30,000 this year. However, he notes that if Bitcoin can manage its value, it could move to a new high later in the year.

Source: CNBC