Why are cryptos up today? 3 possible reasons

Highlights

• Cryptos are up, and there could be multiple reasons that may have gone into fueling this rally
• In Russia, people may be warming up to cryptos in the face of the ruble losing value
• Ukraine also recently sought donations in cryptos, and millions have been transferred so far

It’s like a stunning rebound in the cryptocurrency space. After a prolonged subdued phase, the aggregate market cap of all cryptos tracked by CoinMarketCap is now above US$1.9 trillion. Let’s not forget that the market cap plunged below US$1.6 trillion during the initial phase of the Russia-Ukraine conflict.

What has gone into feeding this remarkable rally in cryptocurrencies? Let’s know the probable reasons why crypto is up today.

1. Sanctions on Russia

A few analysts claim that sanctions on Russia may have spiked the investors’ interest in Bitcoin, which they may be considering as a substitute to the official currency, the ruble. Reports suggest that activity has gone up in Russia with respect to cryptocurrency purchases at a time when the country is reeling from a sharp decline in the price of the ruble.

Separately, some experts claim Russian companies may use cryptos to evade sanctions. Though this aspect has yet to become clear -- especially when Russia’s central bank doesn’t seem to be in favor of volatile crypto assets -- the sentiment may have boosted the spirits of crypto enthusiasts.

Also read: What’s Polkadot’s consensus mechanism & DOT’s price prediction by 2030?

2. Ukraine crypto donations

Ukraine has sought funds from international donors in cryptocurrencies. According to reports, the wallet addresses shared in a tweet by the country’s official handle on Twitter can accept BTC and a couple of other cryptos. Ukraine is seeking donations and the reports that millions in funds have come in the form of cryptos may be a boost for the crypto market.

Moreover, the West is standing firm with Ukraine, and if tomorrow Ukraine goes on to praise the role of cryptocurrencies in its fight against the Russian invasion, crypto assets may receive a shot in the arm.

3. Utility and safe haven

If Bitcoin could be used by Russian businesses to evade Western sanctions and to immediately transfer funds to a country in need, this adds to the probable utility of cryptocurrencies. Many experts have cited a lack of utility of cryptos in the wider financial world as a major negative point.

Also read: Keep Network trading volume up 400%: What’s KEEP’s price prediction?

The rally of late may be a reflection of the sentiments of a section of investors that may be considering crypto assets as safe havens, more so when Bitcoin is regularly dubbed “digital gold.” How far does this go from here is a wait-and-watch game right now.

Data provided by CoinMarketCap.com

Also read: As Ukraine accepts crypto donations, what is Bitcoin’s future?

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Bottom line

Cryptos are up today, and the total market cap is now over US$1.9 trillion, according to CoinMarketCap. From Bitcoin to Ether and Shiba Inu to Solana, virtually every major crypto asset has gained heavily over the past 24 hours. The reasons might be an uptick in Bitcoin trade in Russia due to the dip in the ruble, Ukraine’s call for donations in cryptos, and cryptos being considered as a safe haven by a section of investors.

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