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Bitcoin Crashes to $35,000 as Russia Declares War on Ukraine

Crypto markets crashed 10%, together with the stock market, as Russian forces started military operations against Ukraine

Bitcoin fell to a one-month low as the crypto markets reacted to geopolitical instability.

The biggest crypto traded at $35,300, down 9% from $39,000. Ethereum dropped even more, by 12.5% to $2,373.

All major cryptos were in the red, posting 24-hour losses from 8% to 20%. Among the biggest losers were Cardano, Doge, Polkadot and Shib, all down 17%.

Crypto markets followed a similar decline in stocks. The S&P 500 dropped 1.4% on the news. Risk assets suffered from a bigger impact, as the tech-heavy Nasdaq index posted the biggest losses, down 2.5%.

As Europe is closer to the conflict, European stocks dropped even more. German markets were down 4.8%, French markets were down 4.4% and UK’s dropped 3.1%.

The Russian economy was hit even harder, with its stock market plunging 29%. The Russian ruble fell to a record low against the USD.

On the other hand, oil and gold were the big winners. Oil surged 7% to $103, while gold jumped to $1950. The precious metal reached its highest level since October 2020.

Russian Attack

Markets were down as Russia started a full-blown invasion of Ukraine. Russian forces moved into areas outside the separatist territories. They also attacked targets near major Ukrainian cities.

In a scripted TV statement on Thursday, Russian President Vladimir Putin announced a full-scale attack against Ukraine. Soon thereafter, reports emerged of attacks on Ukrainian military targets near major cities.

Putin said that Russia did not plan to occupy Ukraine. Moreover, he said that the aim of the attack was to demilitarize and “denazify” Ukraine. Therefore, he asked the Ukrainian military to lay down their arms.

Reports also suggested that Russian military vehicles have crossed the borders into Ukraine. Troops attacked from the north, the south, the east, including from Belarus.

Soon after, Ukrainian officials said that Putin has launched a full-scale invasion of Ukraine. In response, President Volodymyr Zelensky proclaimed martial law. He warned Russia that its actions could start “a major war in Europe.”

World War 3?

This is what markets are concerned about as well. A full-scale conflict could have serious disruptive economic effects.

While U.S. and NATO have not committed to a full-scale war against Russia, they promised retribution. President Joe Biden said that the U.S. and its allies would respond “in a united and decisive way.”

President Putin has chosen a premeditated war that will bring a catastrophic loss of life and human suffering. The world will hold Russia accountable.

In addition, U.S. officials detailed further sanctions against Russia. These sanctions targeted banks, individuals tied to the government, and Russian sovereign debt.

European Commission President Ursula von der Leyen called the invasion “the darkest moment in European history” since WW2.

We condemn this barbaric attack, and the cynical arguments used to justify it. Later today we will present a package of massive, targeted sanctions.

Moreover, she announced sweeping sanctions against Russia, the “harshest ever implemented.”

We will freeze Russian assets in the European Union and stop the access of Russian banks to European financial markets. These sanctions are designed to take a heavy toll on the Kremlin’s interests and their ability to finance war.

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Even if NATO and Russia don’t go to war, sanctions and instability will likely hurt the global economy.

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