More valuable than the rouble: How the Ukraine crisis is now boosting the Bitcoin price

A message from our CIO, Scott Phillips:“G’day Fools. If you’re like us, you’re dismayed by the events taking place in Ukraine. It is an unnecessary humanitarian tragedy. Times like these remind us that money is important, but other things are far more valuable. And yet the financial markets remain open, shares are trading, and our readers and members are looking to us for guidance. So we’ll do our best to continue to serve you, while also hoping for a swift and peaceful end to war in Ukraine.”

The Bitcoin (CRYPTO: BTC) price has rallied hard over the past 36 hours.

The world’s first crypto is currently trading for US$44,063 (AU$60,851). That’s up more than 15% since trading for US$38,065 early morning Tuesday, according to data from CoinMarketCap.

Bitcoin price rally will surprise many

The Bitcoin price rally will come as a surprise to some crypto analysts. Many had written the token off as behaving similarly to risk assets in recent months.

Indeed, during Russia’s military build-up on the Ukrainian border and the early days of its invasion, the Bitcoin price rose and fell in line with share markets. Its correlation to tech shares was particularly strong.

But yesterday something different happened.

Most all of the major global indices sold off yesterday (overnight Aussie time), with the tech-heavy Nasdaq falling 1.6%.

But not Bitcoin.

Cryptos buck the risk-off trend

With the Bitcoin price rally, the token’s market cap currently stands at US$836 billion. 

As reported by The Australian, that means the digital asset has surpassed Russia’s rouble in terms of total value.  

Commenting on the big bounce back, eToro analyst Josh Gilbert said:

The political instability will once again highlight Bitcoin’s main goal of being a transparent, opensource, peer-to-peer network not controlled by a single administrator or central bank. This means that even if banks are closed and local currencies fall in value during times of instability, citizens will still have access to capital through crypto.

Walid Koudmani, an analyst at XTB Market, pointed to the impact of the Russian invasion on the Bitcoin price. 

Koudmani said (quoted by Bloomberg), “Bitcoin saw a significant upward move today as it appears to have slightly regained its safe haven status while the Russia-Ukraine conflict continues to intensify.”

Stéphane Ouellette, CEO of FRNT Financial also weighed in on the rebounding Bitcoin price. 

According to Ouellette:

[Bitcoin] has gold-like properties in that if you hold it, you directly control the assets as opposed to governments and banks being in between. In a period where banking is destabilised in a region, which is obviously happening in Europe right now, it would make sense to see some flows into BTC as people diversify away from the banking system.

The moves in Ukraine and Russia are unlikely to have a large impact on the Bitcoin price. However, Ouellette noted that crypto speculators “can get in front of such trends”. 

And this can see prices move higher. 

The post More valuable than the rouble: How the Ukraine crisis is now boosting the Bitcoin price appeared first on The Motley Fool Australia.

More reading

• Is Bitcoin or gold a better buy for these uncertain times?
• How might the Ukraine crisis impact the Ethereum price?
• Why these 2 cryptos are booming in 2022 as the Bitcoin price wallows
• Did Putin just hammer the Bitcoin price?
• Sanctions are a good thing? Why Bitcoin, Ethereum, and Dogecoin are recovering nicely today

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Bitcoin. The Motley Fool Australia owns and has recommended Bitcoin. The Motley Fool has a disclosure policy.  This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 

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