Major cryptocurrencies fell on Thursday after a gain in the previous day’s session as global stock markets rebound after Federal Reserve Chair Jerome Powell said he supported a more modest interest rate rise this month than some investors had been fearing.
World’s largest cryptocurrency Bitcoin was trading 1.24 percent lower at 43,735.99 at 8:45 am, according to CoinDesk data. The cryptocurrency has surged ever since Russia’s invasion of Ukraine. Bitcoin trading denominated in the Russian rouble went into overdrive when the invasion began last week, with daily volumes rising 259 percent from a day earlier to 1.3 billion rouble ($13.1 million), according to CryptoCompare data.
The cryptocurrency initially fell to nearly $34,000 following Russia’s advance into Ukraine last week. However, it surged nearly 25 percent in the past week as Russians and Ukrainians were holding assets in cryptos. Prior to the Russian invasion, bitcoin had been trading in a way similar to other riskier assets such as technology stocks. Bitcoin has witnessed very high volatility this year – the cryptocurrency had hit a low of $32,950.72 on January 24.
Ether, the world’s second-largest cryptocurrency which is linked to ethereum blockchain, also lost 0.86 percent to $2922.
Meme crypto Dogecoin was trading 1.46 percent lower at $0.132, while Shiba Inu lost 2.87 percent to trade at $0.000026. Solana, which witnessed substantial interest from the crypto traders last year, lost 3.74 percent to trade at $98.53.
Other cryptocurrencies such as Litcoin, XRP, Chainlink, Cardano, Polygon, Stellar, Internet Computer, and Avalanche were also trading in the negative territory.
“After a strong 25 percent rally in the last one month, Bitcoin’s rise came to a halt as the digital token market saw some profit booking. Also, Federal Reserve’s chair Jerome Powell’s testimony before the US Congress has dampened the sentiments,” said Kunal Jagdale, Founder, BitsAir Exchange.
“The growing tension in Eastern Europe has plagued the market and investors lapped up digital tokens at decent prices. However, the ongoing saga will sadden the global economy, fueling inflation to rise further as the commodities are commanding unprecedented premiums. It will impact the emerging markets and cryptos are no exception.”
Wall Street indices closed higher on Wednesday after Federal Reserve Chair Jerome Powell said he supported a more modest interest rate rise this month than some investors had been fearing.
Meanwhile, the United States and European Union were trying to make sure that Russia cannot use cryptocurrency to avoid sanctions. US Senator Elizabeth Warren and three other Democratic lawmakers on Wednesday urged the Treasury Department to ensure the cryptocurrency industry is complying with sanctions imposed on Russia.
French Finance Minister Bruno le Maire on Wednesday said the EU was seeking to make sure that cryptocurrencies were not used to circumvent sanctions imposed by the bloc against Russia.
The 27-nation bloc imposed sanctions on Moscow over its aggression on Ukraine, including freezing Russian central bank assets and disconnecting seven Russian banks from the SWIFT financial-messaging system.
(Edited by : Bivekananda Biswas)
First Published: IST