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Bitcoin falls 12% as the Russian ruble falls to an all-time low

The ruble fell below 87 to the dollar early Thursday as events in Ukraine worsened and Bitcoin’s price plummeted.

As geopolitical tensions in Europe boiled over, Bitcoin (BTC) dropped below $34,300 overnight on February 24.

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“Both sides of the argument” for BTC price forecast

The announcement that Russia has initiated a “special military operation” in Ukraine sent BTC/USD and traditional markets plunging. Reports of an anticipated three-pronged attack on Ukraine were circulating at the time of writing, catching markets off guard, with the West already threatening more severe penalties as a response.

Bitcoin, which was already moving in accordance with stocks rather than acting as a safe haven, displayed its own unpredictability, falling over 12.2% from Wednesday’s local highs to $34,300.

Asian stocks were already under stress, with Hong Kong’s Hang Seng index falling 3.5 percent and Japan’s Nikkei falling to a 15-month low.

While traders awaited the full impact of the geopolitical events on European and US stock markets, Bitcoin market participants assessed what the geopolitical events would entail for the world’s largest cryptocurrency.

“As a result, there are discussions on both sides about what should happen to BTC right now. Based on the fundamentals, I’m not sure I would have predicted it would fall. But it’s down, and down, and down, and down, and down, and down, and down, and Why?” In a series of tweets on Thursday, Sam Bankman-Fried, CEO of trading firm FTX, enquired.

“Let’s imagine the world is divided into two categories of people: fundamental investors and algorithm followers. Fundamental investors are unsure which way BTC/USD should travel in the current situation. The data is consulted by algorithm followers. What has been the pattern in the past?”

He went on to say that the Ukraine issue could have financial ramifications for its European Union neighbors, and that “alternatives” might play a role in their strategy.

BTC/USD was seeking to reclaim some of its lost territory at the time of writing, having so far remained above January’s low of $32,800.

Consumers in Russia are suffering from the ruble’s depreciation.

Meanwhile, Russia’s central bank indicated that it would intervene in currency markets after the ruble’s value plummeted as a result of recent events.

The USD/RUB exchange rate hovered around 87 on Thursday, up from 80 the day before. The Moscow Stock Exchange’s parent company, MOEX Group, has paused trade.

Consumer exchange rates were far more erratic, with indexes showing 115 rubles per dollar or more for consumers looking to buy USD on the open market.

Alex Gladstein, the Human Rights Foundation’s chief strategy officer, who is well-known for his pro-Bitcoin attitude, reacted by mocking the political infrastructure of the fiat money system.

“It’s sickening how leaders utilise fiat currency, which all of their population rely on and earn in, to wage war,” he wrote.

“Whether it’s through a printing press, a national credit card, or, in this case, taking actions that are likely to be penalized by international markets,” says the author.

According to sources, Ukraine’s central bank took action to prohibit foreign currency cash withdrawals.

Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

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