Overall cap drops 5%, Bitcoin falls nearly $2,500 as Russia launches special military operation in Ukraine

Bitcoin price plunged nearly $2,500 after Russian President Vladimir Putin announced a “special military operation” to complete the “demilitarization” of Ukraine.

All signs now point to an impending Russian invasion of Ukraine, and the media have reported explosions in the capital, Kiev.

After Moscow’s actions in eastern Ukraine, the Ukrainian government will declare a state of emergency over all regions of the country under its control. The mayor of Kiev has declared a state of emergency in the capital effective midnight local time.

While the people of Ukraine and citizens of the world have more urgent concerns than crypto prices right now, given Russia’s importance to the energy sector, the market is one way to quantify the fear.

The total crypto market cap has lost around 5% in the past 24 hours, slipping to $1.55 trillion. Most of these losses came immediately after the invasion was announced.

Total Capitalization Chart. Source: TradingView

In less than half an hour, Bitcoin crashed from $37,000 to the mid-$34,000 region.

Bitcoin price chart. Source: TradingView

Besides Bitcoin, altcoins in the top 100 are completely in the red, with the top 10 altcoins suffering losses of between 9-11%.

Source; Coin360

Not only the crypto markets are appalled. The US stock market continued to enter correction territory today, with the Dow Jones Industrial Average down 1.38%. Asian markets, which were open during Putin’s announcement, are also reacting negatively, with the Nikkei falling 1% and China’s Hang Seng index 2% lower.

Economist Jason Furman, a former adviser to President Barack Obama, said this week: “Russia has nothing to do with the world economy except oil and gas. It’s basically a big gas station.”

With supply chains already stretched and global inflation rising, energy shortages will only add to concerns for businesses and consumers. While bitcoin is often viewed as a hedge against inflation and economic certainties, its introduction into traditional finance means that its price movements are increasingly correlated with market stock.

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