- Bitcoin sank as low as $36,370 early Tuesday, its lowest level in more than two weeks.
- Analysts attributed the drop to escalating tensions over the Russia-Ukraine crisis.
Digital currencies fell on Tuesday as geopolitical tensions over Ukraine roiled global markets.
Bitcoin was last down about 0.5% at $38,011.54. The cryptocurrency sank as low as $36,370 in early morning trade, its lowest level in more than two weeks.
Analysts attributed the drop to escalating tensions over the Russia-Ukraine crisis. Russian President Vladimir Putin on Monday ordered troops into two breakaway regions in eastern Ukraine, moments after declaring them as independent.
The move has fueled fears of a full-blown invasion, sending global stocks sharply lower as traders’ appetite for risk declines.
“Bitcoin’s safe haven narrative has almost completely fallen apart as the rising possibility of military conflict and the worsening U.S.-Russia relationship puts the wider financial market in risk-aversion mode,” said Yuya Hasegawa, crypto market analyst at Japanese bitcoin exchange Bitbank.
Bitcoin is often touted by its proponents as a safe haven asset akin to gold, meaning it should offer a store of value in times of uncertainty.
However, the case for bitcoin as a sort of “digital gold” has broken down as more institutional investors have started to trade it, and the cryptocurrency is becoming more closely aligned with fluctuations in traditional markets like equities.