Digital Assets: Crypto Week At A Glance: Digital Assets Dance To The Beat Of World Events
Diving into Cryptography
The price of bitcoin fell 8% on Thursday morning, and traditional markets were not spared from the disarray either.
This could be seen as a good sign, as many analysts’ predictions were that the cryptocurrency could see a rise in price due to global disruptions, as it is seen as an alternative to government-backed currency and assets. .
But instead Bitcoin and other digital assets have slumped as there is open conflict between Russia and Ukraine. The latest downturn translates to a decline in the value of the cryptocurrency market to $1.75 trillion, according to data from CoinmarketCap.
Bleeding Altcoins
Many other crypto assets suffered even more losses than Bitcoin, averaging around 18-20%. Ethereum, the second most traded cryptocurrency, fell almost 11% on Thursday morning, and many other large coins also fell more than 10%.
Due to these rapid declines, crypto trading volumes have increased significantly. Trading activity rose 45% on Thursday, CoinMarketCap reported.
Global financial markets
The weak performance was also seen in other financial markets, including equities and commodity prices.
Conventional benchmarks in Europe and Asia fell 4% as traders tried to determine the extent of Putin’s incursion and the extent of Western retaliation. Wall Street futures fell a surprisingly large 2.5% daily margin.
In Brussels, the president of the European Union (EU) said on Thursday that the 27 EU countries were planning a formidable response to Russia’s attack on sanctions and held President Puting responsible for the devastation.
Putin said Russia’s actions were aimed at protecting civilians in eastern Ukraine, a claim the West says justifies an invasion.
Cryptos face another challenge
What is very interesting is that the reputation of crypto assets as an alternative, and obscure economy at that, is gradually being challenged by the crypto markets’ more predictable and limited response to global events.
As crypto-assets and crypto-trading become more mainstream and public and financial institutions feel more comfortable investing and trading them, it is encouraging to see both their reaction to global events and their volatility become more and more in traditional assets.
Top five winners of the week
- Earth (LUNA) : +52%
- Anchor Protocol (ANC): +51%
- Waves (WAVES): +27%
- Cosmos (ATOM): +11%
- Helium (HNT): +5%
- Top losers this week –
- Convex Finance (CVX): 24% decrease
- Neo (NEO): 20% deposit
- Kusama (KSM): 17% decrease
- PancakeSwap (CAKE): 16% decrease
- The graph (GRT): 15% off
(Note: Data as of 12:15 PM IST, February 27, 2022; Source: Coinmarketcap.com. Only the top 100 cryptos by market capitalization are considered.)
(The author is Pratik Gauri, CEO and Founder, 5ire. Opinions are his own)
