Russia-Ukraine Crisis: Cryptocurrencies will not be shielded from global volatility, says industry

moneycontrol.com:

With wars come worries and uncertainty and that is exactly what has been visible in how global markets have been reacting to Russia’s invasion of Ukraine. Stock markets plunged in trade on February 24 after Russian President Vladimir Putin announced a military operation, and cryptocurrencies were not spared from the aftermath.

While Bitcoin, Ethereum, Shiba Inu, Dogecoin, and others recovered after a drop, the crypto industry is ready to face the impact of global jitters and does not believe that tokens will be shielded from this volatility. Bitcoin had dropped to $34,324, the lowest since January 24. It is now trading at above $38,500.

WazirX co-founder and CEO of exchange WazirX said, “We will see the same results on crypto as what is seen in global financial markets, especially Bitcoin. Many have been saying that Bitcoin gain from this, but I don't believe so. Ultimately, everything is a function of sentiments and war is always a bad sentiment for financial markets.”

For Indian investors, Shetty added, it’s a double whammy. A 30 percent tax rate was announced in the budget on gains from virtual digital assets like cryptos starting FY24, and regulatory clarity is still awaited. War concerns and drop in prices just add to the uncertainty.

“Geopolitical volatility has a broad economic impact, and crypto is not immune to this. Users must keep in mind that risk and reward go hand in hand and can be influenced by outside factors,” said Ashish Singhal, founder and CEO of exchange CoinSwitch.

Gaurav Dahake, founder and CEO of Bitbns sees this as an initial reaction to the situation in Ukraine. As per historic behaviour, markets tumble on the day the wars begin and then show signs of recovery. Dahake expects the same to happen with