Bitcoin price recorded a move upward more than 12% on Tuesday continuing its rebound as the Russian attack on Ukraine continues and the US and Europe throws barrage of sanctions on Russia.
According to CNBC report, the cryptocurrency last rose 12.5% to $44,249.08, according to Coin Metrics. That rally comes after cryptocurrency prices plunged last week as risk assets such as stocks sold off following Russia’s invasion of Ukraine.
Ether jumped 10% to 2,994.29. Earlier in the day the crypto asset rose above $3,000.
Market analysts said there could be a number of reasons behind the big surge in bitcoin including investors buying the dip, attempts to evade sanctions and Ukrainians and Russians trying to get their money out of their respective countries.
Bitcoin’s rally comes as the U.S. imposed further sanctions on Russia. Washington targeted Russia’s central bank, effectively prohibiting Americans from doing any business with the bank as well as freezing its assets within the U.S.
That comes on top of sanctions that have targeted oligarchs and Russia’s sovereign debt as well as moves aimed at cutting the country off from the global financial system.
Debate has been raging over whether bitcoin, which is not owned or issued by a single authority like a central bank, could be used by Russia to evade sanctions.
Bitcoin traded at a 6% premium on Binance exchange’s Ukrainian hryvnia market, according a note published by cryptocurrency research firm Kaiko on Monday. Kaiko also noted that it is “seeing a surge in both Russian ruble and Ukrainian hryvnia cryptocurrency transactions” on cryptocurrency exchanges.
“Until there were no heavy financial sanctions on Russia, bitcoin was moving in tandem with the U.S. stock indexes, but these reports, which confirmed real use case for cryptocurrencies in times of crisis, are pushing the price higher,” Yuya Hasegawa, crypto market analyst at Japanese exchange Bitbank, told CNBC on Tuesday.
On Sunday, Mykhailo Fedorov, vice prime minister of Ukraine, asked major cryptocurrency exchanges to block the addresses of Russian users.
Binance, the world’s largest exchange, said it would freeze accounts for any Russians on the sanctions list, but would not “unilaterally” block accounts of all Russian users.
Other cryptocurrency exchanges took a similar stance.
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