The Market Faces High Volatility Amid Russian Invasion Of Ukraine

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This Week’s Summary

• The cryptocurrency market looks to end the week at a total market capitalization of $1,765 trillion.
• Bitcoin (BITCOMP) increased by almost 2% after a highly volatile week.
• Ethereum (ETH-X) is up by over 4% this week.
• XRP (XRP-X) lost over 5% of its value in the past seven days.
• Almost all altcoins are trading in the red after a rough period.
• The DeFi sector lost roughly $2 billion from the Total Value Locked in protocols, which now stands at $68.91 billion.

Cryptocurrency Trends for the Week of Feb. 21-27, 2022: Market Analysis and Performance

The world stood and watched in shock as Russia invaded Ukraine on Thursday, Feb. 24. Meanwhile, worldwide financial markets took a nosedive, and the crypto market was not an exception. Most digital assets started bleeding heavily as they recorded massive sell-outs.

Fortunately, someone’s always there to buy the dip. And thanks to them, some of the cryptocurrencies recovered over the past few hours. Even the market capitalization managed to snatch back almost $20 billion and stay north of $1,75 trillion.

Rumors of a war breaking out have been around for three months. However, it was only in the past couple of weeks that they affected financial markets. When the rumors turned real, every asset started plummeting, including stocks and the gold price.

Bitcoin dropped from nearly $40,000 to almost $33,000 in less than 24 hours. At that point, the king coin was ripe for dip buyers. Fortunately, the U.S., the U.K, and most E.U. states announced severe sanctions for Russia for its aggression. This helped boost most financial sectors, including the crypto market. BTC managed to regain the $39,000 level, but it is still subject to intense volatility.

Ethereum followed in Bitcoin’s steps and took a turn for the worse when news of the war broke out. The second crypto in command struggled to remain above the $2,000 level. And, it owes its recent, yet slight, recovery to the international community sanctioning the Russian invasion of Ukraine.

Altcoins & DeFi

Ripple’s XRP did not enjoy the same speedy revival as Bitcoin or Ethereum. On the contrary, XRP has continued to trade in the red. Following a 5% value loss this week, the coin has recently been trading at only around $0.74.

Elsewhere, most altcoins have recently been trading in the red. For example, Cardano (ADA-X) dropped by 6% and Solana (SOL-X) by 4%. Furthermore, Dogecoin (DOGE-X) is down by 8%, and Shiba Inu (SHIB-X) decreased by more than 5%.

On the other hand, Polkadot (DOT-X) is among the few cryptocurrencies trading in the green following an increase of over 8%. However, the best performer is LUNA (LUNA-X), with a massive 55% increase in value.

The Metaverse sector is also bleeding, with most projects losing precious value points. For example, Decentraland (MANA-X) is down by 2%, and The Sandbox (SAND-X) dropped by more than 6%. Lastly, Axie Infinity decreased by over 5%, and Theta Network lost 2%. The DeFi sector lost nearly $2 billion from the total value protocols (TVL), which now stands at almost $68.91 billion.

What’s in the News?

• The Ukrainian military raised over $4 million from crypto crowdfunding.
• The BitConnect founder faces indictment over alleged $2.4 billion fraud.
• The police have confirmed the death of Apple store gunman demanding €200 million in crypto.

Next Week’s Crypto Market Forecast

These are delicate times for all financial sectors, not only the crypto market. It is difficult to foresee how the situation will evolve from here. Unfortunately, everything depends on the fast changes happening in the Russian invasion of Ukraine. We can only hope for peace and a quick return to normality.