Following a tumultuous week, the crypto markets appear to be recouping their losses. The geopolitical tensions between Russia and Ukraine, as well as the EU parliament’s proposal to ban Proof-of-Work, shook markets.
The crypto markets appear to be recovering after falling on Sunday as a result of news of the EU’s proposed rule, which could have effectively banned Proof-of-Work cryptos like bitcoin and Ethereum across the European Union (EU).
Bitcoin gained nearly 7% in 24 hours after the majority of the EU Parliament voted against the provision, bringing it back near the $40k mark as bulls stepped in to buy the dip.
AVAX led the pack in terms of gains this week, rising up to 17 percent to trade at $84.22, while Ethereum rose 15 percent to close at $2,935. Solana performed well with a gain of 12%, while Polkadot and XRP both gained at least 7%.
At press time, Bitcoin’s price has not moved much and is up 2.08 percent in the last 24 hours, trading around the $41k mark. Ethereum, on the other hand, is up 4.38 percent and trading near the $2,933 mark. Avalanche and Solana continue to rise, with gains of 5.66% and 2.29 percent, respectively. AVAX is the biggest gainer among the top ten assets by market cap in the last seven days, up 17.97% to $83.55.
Around $150 billion was wiped out of the crypto market at the start of the week. The market has since recovered some of its losses, gaining an additional $139 billion, bringing the global crypto market cap to around $1.87 trillion.
The Russia-Ukraine crisis has increased global anxiety and panic. The crypto and equity markets began to fall within minutes of Putin’s initial broadcast on Russia’s military operation in Ukraine, as the correlation between the crypto and traditional markets persisted.
The trend has coincided with institutions’ increasing exposure to the nascent market. According to Chris Dick, a quantitative trader at B2C2, this correlation demonstrates that Bitcoin is currently behaving like a risk asset, rather than the safe haven it was touted to be a few years ago.
It is worth noting that, while these markets were collapsing, gold, the traditional inflationary hedge, soared to $2000 per ounce. Despite all of this, MicroStrategy’s Michael Saylor believes that the conflict will only increase Bitcoin’s appeal. He claims that wars cause inflation, stifle commerce, and make Bitcoin more appealing.
30 May 2023
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