AVN 64.74 Decreased By ▼ -0.26 (-0.4%)
BAFL 31.23 Increased By ▲ 0.08 (0.26%)
BOP 4.82 Increased By ▲ 0.11 (2.34%)
CNERGY 3.86 Decreased By ▼ -0.02 (-0.52%)
DFML 14.11 Increased By ▲ 0.41 (2.99%)
DGKC 41.69 Increased By ▲ 0.42 (1.02%)
EPCL 46.36 Decreased By ▼ -0.33 (-0.71%)
FCCL 11.41 Decreased By ▼ -0.01 (-0.09%)
FFL 5.06 Increased By ▲ 0.02 (0.4%)
FLYNG 5.78 Decreased By ▼ -0.04 (-0.69%)
GGL 9.92 Decreased By ▼ -0.03 (-0.3%)
HUBC 64.23 Increased By ▲ 0.13 (0.2%)
HUMNL 5.61 Decreased By ▼ -0.04 (-0.71%)
KAPCO 27.84 Increased By ▲ 0.04 (0.14%)
KEL 2.15 Increased By ▲ 0.02 (0.94%)
LOTCHEM 24.52 Increased By ▲ 0.22 (0.91%)
MLCF 21.75 Increased By ▲ 0.35 (1.64%)
NETSOL 84.19 Decreased By ▼ -0.01 (-0.01%)
OGDC 87.30 Decreased By ▼ -0.64 (-0.73%)
PAEL 10.95 Increased By ▲ 0.05 (0.46%)
PIBTL 4.24 Increased By ▲ 0.06 (1.44%)
PPL 76.63 Decreased By ▼ -1.07 (-1.38%)
PRL 13.69 Increased By ▲ 0.07 (0.51%)
SILK 0.90 Increased By ▲ 0.01 (1.12%)
SNGP 41.52 Decreased By ▼ -0.41 (-0.98%)
TELE 5.95 Increased By ▲ 0.08 (1.36%)
TPLP 15.77 Decreased By ▼ -0.01 (-0.06%)
TRG 111.25 Decreased By ▼ -1.05 (-0.93%)
UNITY 13.92 Decreased By ▼ -0.03 (-0.22%)
WTL 1.14 Increased By ▲ 0.01 (0.88%)
BR100 4,046 Decreased By -1.8 (-0.05%)
BR30 14,434 Decreased By -33.1 (-0.23%)
KSE100 40,620 Decreased By -53.1 (-0.13%)
KSE30 15,170 Decreased By -20 (-0.13%)
Follow us

Bristling tensions and looming laws in Europe could offer clues to two questions: Can bitcoin be a safe-haven asset? And can Russia emerge as a crypto superpower?

The answer to the first, for now at least, is no; while fortress gold has risen 2.3% over the past week, as Western warnings about Russian aggression have intensified, bitcoin has lost 3%. That was worse than the 0.9% decline of the Nasdaq Composite index.

"I don't see any evidence of bitcoin being a safe haven," said Chris Weston, head of research at Melbourne-based brokerage Pepperstone. "The Ukraine situation with Russia is a really hard one to price, so in that situation, you just buy crude futures."

Yet it's too early to dismiss the argument made by many bitcoin advocates who say the cryptocurrency, just into its teens, is destined to be a form of digital gold that should retain its value when riskier assets such as stocks tumble.

While bitcoin has slipped towards levels of around $42,000 in recent days, it hasn't surrendered all the gains made from lows of $32,950 hit on Jan. 24.

Some investors also point to how relatively calm trading has been, at a time of high geopolitical tension, with Russia having massed more than 100,000 troops near Ukraine, though rejecting Western prophecies of invasion as "hysteria".

Bitcoin's average 30-day volatility has fallen to 3.48%, versus its 2021 average of 4.56%, according to BuyBitcoinWorldwide's volatility index.

Wall Street Week Ahead: Crypto investors face more uncertainty after rocky start to 2022

Data platform Coinglass' bitcoin Fear & Greed index, which measures market sentiment - 0 indicates extreme fear and 100 is extreme greed - stands at 46, above the nervy 11-33 range where it had been trading since late November.

Matthew Dibb, chief operating officer of Singapore-based crypto platform Stack Funds, said he was bullish on crypto in the longer term as an alternative asset and a hedge to world events - "But not quite yet."

"We are beginning to see some discorrelation between bitcoin and the equities market, which is very nice," he added. "But while we're seeing some traditional safe havens pop off with the Ukraine and Russia situation, we haven't really seen that in crypto."

Crypto superpowers

Meanwhile: A new law for crypto assets expected to be announced in Russia this week could potentially shape the global scene.

Russia's importance for cryptocurrencies has been growing over the past year after a ban on bitcoin mining in China, previously the world's dominant centre for the activity, sent miners scrambling for alternatives.

Russia had become the third-largest centre for bitcoin mining in the world as of last August, according to data from Britain's Cambridge Centre for Alternative Finance.

The United States accounts for the largest share of mining, about 42.7% of the global "hashrate" - the computing power being used by computers connected to the bitcoin network - followed by Kazakhstan and Russia with 18.1% and 11.2% respectively.

Some industry watchers believe Russia might have since overtaken Kazakhstan, where miners have contended with government internet shutdowns during unrest this year.

It remains unclear, though, what the Russian regulations will hold.

Last week authorities said they were working on rules that would allow cryptocurrency purchases to take place, but only through locally registered and licensed companies. Industry players saw this as a positive development after the central bank had proposed banning the use and mining of cryptocurrencies in January.

Crypto donations soar to groups backing Ukraine's government: report

Russian Deputy Finance Minister Alexei Moiseev said on Monday that ensuring that money flows and crypto transactions could be traced was crucial, including being able to identify users. If included in the draft law, that may diminish one of cryptocurrencies' major selling points - their anonymity.

Moiseev also told reporters that banks and exchanges, required to comply with anti-money laundering laws, would be the only legal entry point for crypto into the Russian market.

Comments

Comments are closed.

Bitcoin runs into Russian rules and regiments

'Higher than expectations': Pakistan's headline inflation clocks in at 27.6% in January

Rupee sustains losses, settles at 268.83 against US dollar

Fawad Chaudhry released from Adiala jail

Imran says governor KP's letter to ECP regarding delay in polls raises 'suspicions’

Cannot rule out internal assistance for Peshawar bombing: police

Peshawar attack: ‘Who brought the terrorists back?’, asks PM Shehbaz

Hyundai-Nishat jacks up car prices by up to Rs500,000 in Pakistan

Maryam Nawaz says PML-N will clean sweep upcoming elections

PSX sees range-bound session, KSE-100 falls 0.13%

US, India partnership targets arms and AI to compete with China