Cryptocurrencies are in the First War. They have misled everyone, but what’s next?

An unprecedented situation. This is perhaps the most accurate description of current events in the world, where we have been witnessing armed conflict for more than a week in a country with which we have a direct border. The Russian invasion of Ukraine surprised almost everyone, but the markets somehow “predicted” its behavior a few weeks in advance.

Times of war are generally not good for most assets and financial products, which form “safe havens” for investors and ordinary people during peace. For example, the S&P 500 and NASDAQ stock indices, after a brief “awakening” of the January correction, fell mostly throughout February, and their slippages deepened, especially after the US authorities announced a Russian attack that could come at any time. This finally happened on February 24, during which almost all assets were recorded with large losses, with the exception of oil or shares in companies from the armaments industry.

However, with cryptocurrencies, the situation is a bit more complicated. Some might say that an asset that is still considered high risk will be escaped by investors at such times. This is partly true, and perhaps no one was surprised that the biggest cryptocurrency, along with the entire market, was drawn to the red by the beginning of the armed conflict in Europe.

After a relatively long decline, Bitcoin began consolidating around $ 40,000, which it held during the first statements about a possible open conflict in Ukraine. However, immediately after the first reports of the beginning of the war bitcoin fall by about 10%, while from the whole market according to Coinmarketcap during the first hours of the war in Ukraine, it “erased” nearly $ 200 billion. However, a different situation came in the following days.

Cryptocurrencies “showed strength”, investors did not give up bitcoin