Experts have cast doubt on cryptocurrency\u2019s ability to weather global storms in the wake of the Ukraine-Russia conflict. <\/p>\n<\/div>\n
Ever since tensions between the two nations brewed into full-on war last week, cryptocurrency has been on a roller coaster in terms of its prices. <\/p>\n
Last Thursday, the top-ranked cryptocurrency, bitcoin, briefly dipped below US$35,000. It is now trading slightly higher, at US$37,000. <\/p>\n
Other major coins including ethereum, solana and ripple XRP have also taken a huge hit in recent days. <\/p>\n
The combined bitcoin and crypto market capitalisation has almost halved in value since its November peak. In the past few days, US$500 billion (A$700b) has been wiped from the market<\/a>. <\/p>\n Forbes warned on Sunday<\/a>: \u201cBitcoin\u2019s extreme price volatility at a time when the gold price has climbed has undermined the popular narrative that bitcoin has begun acting as digital gold, a so-called safe-haven asset that investors flee to in times of perceived risk\u201d.<\/p>\n Stay up to date with the latest market moves with Flash. 25+ news channels in 1 place. New to Flash? Try 1 month free. Offer ends 31 October, 2022 ><\/a><\/b><\/i><\/p>\n The publication wasn\u2019t the only one with concerns about bitcoin\u2019s safe haven capabilities. <\/p>\n \u201cIf the situation in Ukraine escalates even more bitcoin may fall below $30,000 as investors leave for defensive assets,\u201d said Alex Kuptsikevich, financial analyst at FxPro, in a note. <\/p>\n Experts are worried of a mass sell-off in the wake of the panic from investors.<\/p>\n \u201cRegardless of asset class, there\u2019s a tremendous amount of volatility that comes with war,\u201d said Doug Boneparth<\/a>, a financial planner and founder of Bone Fide Wealth. <\/p>\n \u201cIt\u2019s going to make it that much more difficult for investors to stick to their strategies.\u201d<\/p>\n Another prominent financial analyst warned that this increased volatility could sound cryptocurrency\u2019s death knell and that the market could be stuck until 2024. <\/p>\n Du Jun, the co-CEO of cryptocurrency exchange Huobi, told CNBC<\/a>: \u201cIf this circle continues, we are now at the early stage of a bear market.\u201d<\/p>\n \u201cFollowing this cycle, it won\u2019t be until end of 2024 to beginning of 2025 that we can welcome the next bull market on bitcoin.\u201d<\/p>\n The Russian economy has also taken a battering through war costs and hefty sanctions placed on the nation by its western counterparts. <\/p>\n There are reports that the war effort is costing Russia a whopping US$19 billion (A$27 billion) a day.<\/p>\n Russia was also booted out of SWIFT, a network used internationally for payments, in what one expert has cited as a \u201ccatastrophe\u201d for the coming week.<\/p>\n \u201cIt means there is going to be a catastrophe on the Russian currency market on Monday,\u201d Sergei Aleksashenko told Reuter<\/a>s<\/i><\/a>. <\/p>\n \u201cI think they will stop trading and then the exchange rate will be fixed at an artificial level just like in Soviet times.\u201d<\/p>\n Cryptocurrency is actually aiding Ukraine\u2019s war effort. <\/p>\n On Sunday, the official Twitter account of the Ukraine government pleaded for donations through cryptocurrency. <\/p>\n \u201cStand with the people of Ukraine. Now accepting cryptocurrency donations. Bitcoin, ethereum and USDT\u201d, they tweeted, alongside the details for two cryptocurrency wallets.<\/p>\n In just over the following 24 hours, more than US$10 million (A$13 million) has so been received in the two accounts. <\/p>\n