This weekend, the crypto market turned red as fears about a Russian invasion continue to grow among the community. Bitcoin (BTC) has registered losses of 4% in the last 24 hours while other altcoins such as Shiba Inu (SHIB) fell by over 10% during the same period of time. The larger the fears of a Russian invasion of the Donbas region in Ukraine, the larger the sell-off in the cryptocurrency market.
Crypto Market Turns Red Amid Russia-Ukraine Conflict
The crypto market has now turned red as people started leaving the Donbas region in Ukraine due to fears of a direct clash between Russia and Ukraine. As risk assets, Bitcoin and altcoins were hit as the conflict in the Eastern parts of Ukraine continues to intensify.
Shelling has been reported throughout the last week in Donetsk and Luhansk. This situation is pushing the conflict to the worst moment since 2018 when separatists tried to reinforce their positions in the East of Ukraine. These growing tensions are pushing civilians to move from Donetsk and Luhansk to other regions in Ukraine and even abroad.
We have also seen different Airlines such as Swiss and KLM leaving the country as tensions grow. In 2014, separatists shot a Malaysia Airlines plane going from Amsterdam to Kuala Lumpur killing 258 on board.
This Russia-Ukraine conflict has also affected traditional financial markets, not only the crypto market. Indeed, we have seen that cryptocurrencies have been highly correlated with international financial markets over the last few months. This could also show that there is a larger number of institutional investors interested in Bitcoin and other virtual currencies.
If a full-scale conflict explodes between Ukraine and Russia, then we could see the crypto market fall even further. Nonetheless, as it already happened in 2014 when Russia took Crimea, traditional financial markets might only move downwards for just a few days before resuming their move higher.
It is also worth taking into consideration that the level of conflict between these two countries could be different, and this will have a deep impact on how much the markets could fall. For example, Russia could continue supporting local separatists without a full-scale invasion. However, if Russia ends up attacking Kyiv, or other cities such as Mariupol or Mykolaiv.
Bitcoin is now being traded close to $38,350 and it has a market capitalization of $727 billion. Ethereum (ETH) is being traded close to $2,600 and Binance Coin (BNB) is now standing at $377 per coin.