The crypto market rose on Monday after the Treasury Department imposed new sanctions against Russia’s central bank.
Bitcoin jumped 10.4% to $41,807.16, while ether rose 7.6% to $2,826.54. U.S. equities were down sharply earlier in the day before recovering a big chunk of their losses.
“In the past, there has been a strong correlation between traditional assets liquidating and drops in digital assets,” said Valkyrie Funds CEO Leah Wald. “However, we aren’t seeing that right now and the crucial test is to see whether this pattern holds. If it does, we could potentially be at the tipping point many have been waiting for, where bitcoin and other coins have perhaps become mainstream.”
The sanctions unveiled by the Biden administration would effectively prohibit Americans from doing business with the Russian central bank and freezes assets within the U.S.
The moves highlight the role crypto can have in military conflict. The young asset class has never had the opportunity to show its potential significance in that type of environment before, though its proponents have often emphasized it as part of their bull case for bitcoin.
Since Thursday, when the invasion by Russia began, transactions on centralized bitcoin exchanges in both the Russian ruble and the Ukrainian hryvnia surged to their highest levels in months, according to crypto data company Kaiko.