Cryptocurrencies are plummeting, while the coronavirus variant is shaking markets

A representation of the virtual cryptocurrency Bitcoin is seen in this image illustration taken October 19, 2021. REUTERS / Edgar Su / File Photo / File Photo

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LONDON, Nov. 26 (Reuters) – Bitcoin toppled over 9% on Friday, pulling down smaller tokens after the discovery of a new, potentially vaccine-resistant variant of coronavirus prompted investors to dump more risky assets for perceived security of bonds, yen and dollars.

Bitcoin, the largest digital currency, fell as much as 9.2% to $ 53,551, the lowest since October 10th. The second-largest cryptocurrency ether fell over 13% to its lowest in a month as investors dropped cryptocurrencies.

Bitcoin, whose 13-year lifespan has been marked by bouts of extreme volatility, was heading for its biggest drop in a single day since September 20th. It has fallen more than a fifth since reaching a record high of nearly $ 70,000 earlier this month.

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“The spread of (the variant), especially to other countries, may further wither investors’ appetite,” said Yuya Hasegawa of the Tokyo-based stock exchange Bitbank. “BTC’s upside is likely to be limited and the market should prepare for further losses.”

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Bitcoin reached a record high of $ 69,000 earlier this month as several large investors embraced cryptocurrencies, many of which were attracted by its alleged inflation-resistant qualities.

Others have piled into the digital token on the promise of quick wins, a draw that has been amplified by record lows or negative interest rates. Yet bitcoin’s volatility has persisted, and it has questioned its suitability as a stable stock of value.

Ether was last at $ 3,924. That’s a drop of almost 20% from its record-breaking hit on November 10th.

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Reporting by Tom Wilson; editing by Carolyn Cohn, Kim Coghill, William Maclean

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