Cryptocurrency Market is rising more than 10% despite War. Following recent advances, crypto traders have been defensive as tensions between Russia and Ukraine have increased. Following this, investors’ interest in riskier assets, such as the digital token, plummeted. Investors began looking for safe-haven bets like gold, further lowering emotions.
All of the biggest digital tokens were trading in the red on Friday, with the exception of Tether, which is tethered to the US dollar. Avalanche and Terra both lost 9% of their value, while Bitcoin and Ethereum both lost more than 7%.
The global crypto market capitalization fell by as much as 7% to $1.85 trillion. The total crypto market volume, on the other hand, increased by more than 25% to $87.62 billion.
What’s Crypto doing in India?
The Enforcement Directorate (ED) is looking into Dawood Ibrahim, India’s most wanted fugitive, and his usage of the darknet and cryptocurrencies, amid suspicions that the underworld don is using digital technologies to launder money and invest it mostly in offshore real estate.
Meanwhile, India’s decision to levy a 30% tax on cryptocurrency trading earnings is proving to be a bonanza for the country’s digital-asset exchanges.
WazirX, which is owned by Binance, has seen a daily sign-up increase of over 30% since February 1, according to co-founder Nischal Shetty. According to founder Ashish Singhal of rival CoinSwitch, the daily gain was 35%.
According to CryptoWire MD & CEO Joseph Massey, various Indian and foreign exchanges have approached CryptoWire for licensing its IC15 index in order to sell products on their exchanges based on this benchmark. The IC15 index, which tracks the leading cryptocurrencies throughout the world in terms of market capitalization, was released by CryptoWire, a Financial Technologies Group subsidiary. It is the first crypto index to emerge out of India.
What Experts are Saying?
“Bitcoin and Ethereum have both dropped in value during the last 24 hours. The leading altcoins, according to market cap, have also decreased “Mudrex’s CEO and Co-Founder, Edul Patel, stated.
“The continuous tensions between Russia and Ukraine are to blame for the current state of the crypto market. Investors, on the other hand, are anxious about inflation.”
The main cryptocurrencies are being directed by global cues, which are losing ground as tensions between Russia and Ukraine intensified. This is weighing heavily on people’s minds…
“Bitcoin is holding above $40,000, a crucial psychological support level that if breached might lead to further loss to $38,000, the next support level. Investors should maintain their composure and avoid taking any needless risks “he continues.
Global Updates On Cryptocurrency
- Global markets have had a bumpy start to the year, with investors fleeing risky assets in anticipation of tighter monetary policy, but the fast-growing world of metaverse investment has been on its own timetable.
- The United States Justice Department has appointed a seasoned computer crimes prosecutor to lead its new national cryptocurrency enforcement team, and the FBI has announced the formation of a unit dedicated to blockchain study and virtual asset seizure.
- In other news, BIT Mining, a Hong Kong-based cryptocurrency miner, has canceled its near-$10 million mining data center construction project in Kazakhstan due to an unreliable local power supply.
Cryptocurrency Expectation During & After the war
Crypto is about to go to war. In addition, Russia’s invasion of Ukraine exposes the blockchain’s limitations — as well as its potential — in a significant geopolitical battle. An initiative to deliver beleaguered Ukrainian bitcoin and other cryptocurrencies fell into practical and legal difficulties. The Biden administration issued a comprehensive list of Russian officials and allies who are now subject to sanctions, and they may well turn to cryptocurrency to avoid the penalties and limits.
“What fascinates me is that crypto will now be front and center for use in this war by both Russia and Ukraine,” said Michael Fasanello of the Blockchain Intelligence Group.
Your crypto is useless in this situation.
The Ukrainian Ministry of Defense has stated that it welcomes donations for logistics and medical assistance, but that it can only accept fiat money transfers to its bank account.
- If you have heard that bitcoin is being used to pay the Ukrainian military, it is because Come Back Alive, a non-governmental group that supports the military, has begun accepting bitcoin.
- Donations could be made through Fondy, SWIFT, a bitcoin wallet, and Patreon, according to the NGO’s website. Its Patreon page caused a stir on social media since it offered subscription packages including “Bomb,” “Bullet,” and “Tank.” According to Internet Archive captures, it had a Patreon page since 2020, but it was taken down sometime Thursday. Patreon stated that military equipment purchases were not permitted.
- The NGO’s bitcoin wallet received 19.9 bitcoin worth $700,000 last night, and it has since risen to 112.6 bitcoin worth $4.4 million. However, it is not exactly a game-changer in the face of Putin’s juggernaut: In 2019, Russia’s yearly military budget was anticipated to be $65 billion.
- Sam Bankman-Fried, the CEO of FTX, also expressed his support for Ukraine, tweeting that the crypto exchange “paid $25 to each Ukrainian on FTX,” adding, “do what you gotta do.”
Russia has resisted the West, but is it up to the task of putting DeFi to the test? The sanctions imposed by the Biden administration targeted Russia’s “corrupt” officials and their families but did not name cryptocurrency.
- There is a rising push to kick Russia out of SWIFT, the global payments network that handles $5 trillion in transactions every day, but there is also concern that the move could backfire.
- In theory, having access to crypto might lessen the severity of the penalty. “The Russians will rely on cryptocurrency to get over global sanctions that are killing their economy,” Fasanello predicted.
- Putin just put a stop to the Bank of Russia’s efforts to outlaw cryptocurrency, which is telling.
- Some people believe in the power of cryptography to the nth degree. “If the Russians decide — and I am sure they have — to avoid using any currency other than cryptocurrencies, they may effectively bypass practically all of the sanctions,” anti-money laundering compliance specialist Ross S. Delston told CNN.
- Governments, on the other hand, are becoming increasingly adept in catching cryptocurrency. Consider Canada’s decision to ban crypto wallets used by trucker convoy sponsors, or the US Department of Justice’s recent recovery of $3.6 billion in stolen bitcoin. Cryptocurrency holders in Russia may be exposed in the same way, especially if they try to pay out their coins.
That is because the number of ways to convert crypto into fiat currency and vice versa is still restricted. This is a dilemma for both those attempting to help Ukraine and those attempting to avoid sanctions.
- In a combat zone, Bitcoin cannot be used to purchase food or medical supplies. To convert your money, you will require a service that is regulated as a money transmitter, which means anti-money laundering regulations apply.
- MoonPay, Transak, and Wyre, for example, provide APIs for enterprises to convert cryptocurrency, but regulation of this aspect of the market is still in its infancy, and the laws are frequently unclear. In Russia, MoonPay and Wyre are not available.
- A hardware wallet is not kept in a safe by the average crypto investor. Most likely, they are using a centralised exchange like Coinbase, whose Super Bowl ad drew millions of viewers. Last year, the corporation admitted to disclosing transactions to the Treasury Department’s Office of Foreign Assets Control, which is responsible for enforcing sanctions.
This is the first battle fought in the crypto-age. The digital asset sector is developing, but there is still a lot of optimism and enthusiasm surrounding it. The idea of sending bitcoin to the front lines is romantic. Soldiers and oligarchs alike, though, still want funds.