Crypto suffers amid ongoing war, impending rate hike

The latest Crypto Market Monitor review from ETF Securities and European cryptocurrency provider, 21Shares, has highlighted the struggles of the crypto market due to the ongoing Russia-Ukraine war and in anticipation of the U.S. Federal Reserve’s interest rate hikes.

The report said Bitcoin was down by 6.4 per cent, Ethereum was down by 8.5 per cent and equity was down 3.5 per cent in the past week, while traditional commodities like oil and wheat have surged.

“It’s been a hard week on markets as the Russian invasion of Ukraine prepares for its third week,” Kanish Chugh, Head of Distribution at ETF Securities, said.

“Other macroeconomic triggers include the Federal Reserve’s infamous interest rate hike to curb inflation which is at its 40-year-high now. The hike is expected to float at 0.25%; a decision is scheduled to be made on March 16.

“Another related trigger that’s been affecting the markets is the Consumer Price Index which will also be affected by next week’s interest rate hike, which will essentially track how much consumers will be impacted in terms of loans, investments, savings, job prospects, and prices for goods and services.”

The review also highlighted several efforts of government and crypto figures to make positive contributions to the war through crypto. The Ukrainian Government said it would release several non-fungible tokens (NFTs) to support the Ukrainian army, while crypto exchange, Uniswap, added a ‘Donate to Ukraine’ feature to encourage crypto owners to make Ethereum donations.

Crypto exchange platform provider, Coinbase, also announced it had blocked more than 25,000 wallet addresses linked to Russian individuals or entities who were suspected of conducting illicit activity.