Crypto market crashes following Russian invasion of Ukraine

Temitope Akintade

On Thursday, February 24, Russian President Vladimir Putin launched a full-scale military invasion on Ukraine and explosions have been reported in the Eastern parts of the country. Those reports have weighed down heavily on cryptocurrencies, triggering a selling frenzy that saw the entire crypto market lose almost half a billion dollars in liquidations.

At the time of writing this, $425.12 million worth of crypto has been ‘rekt’ since the order came in last night with m140,732 traders being liquidated in the past 24 hours according to CoinGlass data. While the largest single liquidation order happened on Bitfinex where LINK valued at $3.21 million was liquidated. Bitcoin and Ethereum also suffered immensely after losing $129.95 million and $116.68 million during the sell-off.

According to data from coinmarketcap, around $200 billion has left the digital asset space over the past 12 hours resulting in a massive market slump which has dropped total market capitalisation to a seven-month low. It has dropped by 9.55% in the last 24 hours to sit at $1.59 trillion – its lowest level since early August 2021.

Bitcoin is currently trading at its lowest since Jan 24 –  $35,625, an 8.36% daily decline. Despite climbing as high as $39,000 yesterday, it is currently 49% down from its November all-time high. Ethereum on the other hand has recoiled back to $2,397 after losing 11.75% of its value in 24hours. Other cryptocurrencies such as Cardano, XRP, LINK, NEAR, DOGE, and AVAX have been the hardest hit, losing over 15% in less than 5 hours. Binance Coin (BNB), Ripple (XRP), Solana (SOL), and Cardano (ADA) are all slumping between 9 and 13 percent. The only coins in green at the moment are stablecoins.

Responses by Crypto Figures

Ethereum’s co-founder, Vitalik Buterin blasted Russia for its highhandedness. 

“Very upset by Putin’s decision to abandon the possibility of a peaceful solution to the dispute with Ukraine and go to war instead. Buterin tweeted in Russian following news that Putin has launched a full-scale invasion of Ukraine. “This is a crime against the Ukrainian and Russian people. I want to wish everyone security, although I know that there will be no security. Glory to Ukraine.”

“Reminder: Ethereum is neutral, but I am not,” he added.

PlanB and Michael Saylor believe that Bitcoin could take center stage in the Russia /NATO faceoff.

“Russia might be the next WikiLeaks moment for Bitcoin.” PlanB wrote. “After the US cut WikiLeaks off from traditional methods of payment like Visa and PayPal, WikiLeaks turned to bitcoin in 2011.”

Vijay Ayyar, Luno’s VP of development, believes that although the effects of the Ukrainian invasion on cryptocurrencies will eventually subside, it could take longer unless tensions in Eastern Europe subside.

“Risk assets continue to be weighed down by the Russia-Ukraine conflict and tensions. This includes Bitcoin and cryptocurrencies which are currently still very much viewed as a high-risk asset class. The next key level to watch for Bitcoin will be $28,000 to $29,000”. 

According to him, a breach of that level could easily send the price to $20,000 or lower.

What this means for the crypto market

With the change in landscape and geo-political tensions, crypto investors would not feel secure. They will remain uneasy until the entire situation between Russia and Ukraine is somehow resolved and that does not look likely any moment soon because it is all looking like a ‘clash of egos’ as the different world powers are now coming out to take sides. Tech and growth stocks will stay in a chokehold for a few months at least, which inevitably brings a crypto winter. We are in for a long ride!

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