How has the Russia-Ukraine war affected Bitcoin?
By Puja Sharma
War in Ukraine and the potential increased use of cryptocurrency in the light of a rapidly devaluing Rouble has sent Bitcoin prices soaring and prompted claims it could hit $50,000 by the end of March.
Bitcoin traders face potential price swings of more than $11,000 with a low range of between $34,600 and $39,500 and a more consistent high range of between $44,100 and $45,900 over the period March 1st to 7th, analysis from GNY, the leading blockchain-based machine learning business, shows.
War in Ukraine and the shock to the global financial system coupled with speculation about fewer rate rises this year and the potential increased use of cryptocurrency in the light of a rapidly devaluing Rouble has sent Bitcoin prices soaring and prompted claims it could hit $50,000 by the end of March.
On 1st March, Ukraine announced an airdrop for anyone who made a crypto donation in the country. Ukraine has received over $30m in crypto donations in the past week. This is a relatively small number compared to donations made directly through organizations or war bonds. That being said, Ukraine is still using an airdrop as an incentive to get more people to donate with crypto.
According to a November 2018 report by the New York Times, the Ukrainian government is trying to promote cryptocurrencies in the country and asks if it can become the world’s “crypto capital”. Ukraine was one of the early adopters of cryptocurrencies. The Chainalysis’ Global Crypto Adoption Index for 2021 places Ukraine in fourth place. The index was topped by Vietnam, followed by India and Pakistan.
According to CoinMarketCap data available at the time of writing this report, Bitcoin price jumped up over 15% in the last seven days. In the past 24 hours alone, Bitcoin price rose 12.51%, trading at $43,094.
Bitcoin’s recent price rise is also due to the emergence of crypto as a viable alternative to the traditional financial system, which has been frayed by recent market volatility. Experts attribute the recent growth of Bitcoin to the fact that crypto is emerging as a viable alternative to the traditional financial system.
However, GNY’s BTC Range Report suggests March 1st to March 7th will see a fairly consistent high range for Bitcoin but “fairly deep and sudden downward shifts to the mid-30,000s during the week.” Daily volumes are forecast to range between $44 billion and $51.7b during the period, the BTC Range Report, which provides some of the most accurate forecasts around Bitcoin volatility of any platform or service available, says.
The report predicted for the week beginning February 24th that the low range would be consistent in the mid-30s providing a potentially good entry point on the day and informed an exit at the $40,000 range.
Cosmas Wong, CEO GNY, said: “The humanitarian crisis in Ukraine is driving huge volatility in financial markets. The goal of the GNY Range Report is to challenge internal biases and emotional reactions to Bitcoin, which is already a highly volatile asset. It informs where traders may want to enter and exit, or fix stop losses in the coming week.”
Research from GNY earlier in the year found one in five (22%) of Bitcoin traders who trade at least $1,000 a month in the cryptocurrency expect the level of volatility in the price of Bitcoin to increase dramatically in 2022, and further 57% say it will increase slightly. Only 18% expect it to fall or stay the same
Extensive testing of GNY’s BTC Range Report has delivered a mean absolute percentage error (MAPE) of between 3% and 7% making it one of the most powerful BTC prediction tools in the market. The average of the majority of competitor BTC prediction tools tested by GNY was 10%, but it was as high as 17% for some platforms.
Key takeaways
- Ukraine war and interest rate speculation are driving market forecasts.
- Bitcoin price jumped up over 15% in the last seven days. In the past 24 hours alone, Bitcoin price rose 12.51%, trading at $43,094.
- The Ukrainian government is trying to promote cryptocurrencies in the country and asks if it can become the world’s “crypto capital”.
- Ukraine has received over $30m in crypto donations.
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