Market Wrap: Bitcoin, ETH Extend Gains as Equity Markets Continue To Fall
Increasing divergence between cryptocurrencies and equities has prompted suggestions that bitcoin has become a risk-off asset
Blockworks exclusive art by axel Rangel
- The ruble’s collapse has pushed bitcoin to an all-time high against the Russian currency
- “When freedom and individual liberty are threatened, the price of bitcoin goes up,” said Antoni Trenchev, co-founder and managing partner of Nexo
Bitcoin reached a new all-time high in rubles and continued to climb in dollars on Tuesday. Sanctions on Russia have caused the ruble to crumble in value, and Russians fear that funds in their bank account could be seized to help stave off a recession, potentially pushing them to invest in bitcoin.
While bitcoin continued pushing higher, equity markets deepened their slide, leading some to speculate that bitcoin could be regaining its status as a risk-off, safe-haven asset.
“I see bitcoin transitioning from a risk-on to risk-off asset, and so far in 2022 the crypto has made good progress on this trajectory,” said Mike McGlone, senior commodity strategist at Bloomberg Intelligence.
Others noted that bitcoin does best in circumstances such as those seen in recent days.
“When freedom and individual liberty are threatened, the price of bitcoin goes up,” said Antoni Trenchev, co-founder and managing partner of Nexo.
The S&P 500 dropped by 1.55% while the Nasdaq and Dow dropped by 1.63% and 1.76% respectively.
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Bitcoin, ether and the majority of major cryptocurrencies kept pushing higher. Bitcoin rose by over 2% by the end of stock trading, bringing its rise to well over 14% in just the past five days. Ether rose by 1.44%, also increasing by more than 14% in the past five days.
The day's largest gainer among top coins in the crypto market was RUNE, which saw a pump of over 32% in the past 24 hours.
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With markets likely to remain highly volatile amid the conflict in Ukraine it will be hard to tell if bitcoin is really becoming a risk-off asset. Jerome Powell’s scheduled testimony before Congress on Wednesday only adds to the uncertainty.
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