The two most popular cryptocurrencies have plummeted as fears rise about a new variant of COVID-19.
Bitcoin and Ethereum prices are falling as reports of a new variant of COVID impact the global financial market. The two cryptocurrencies – which are by far the most popular and well-known cryptocurrencies in the world – have fallen 6.5% and 8.1% in the last 24 hours, respectively.
Bitcoin, which opened the day at a price of US$58,700, is now trading at US$54,595. The Ethereum, which opened the day at $4,400, now costs just over $4,109 and threatens to drop below the landmark price range.
The same downtrend appears in non-crypto markets.
S&P 500, Nasdaq and Dow mini futures have all fallen by at least 1% since the start of the day.
“Markets are very hectic today due to concerns about new virus strains,” Jason Deane, Bitcoin analyst at Quantum Economics told Decrypt.
He added that there could also be other factors – at least related to Bitcoin.
“In the case of Bitcoin, there is almost certainly an overreaction to possible Chinese activity around the so-called, DNS poisoning, of large mining reservoirs affecting the global hashrate,” he said.
A new variant of COVID.
The market slump coincided with the discovery of a new COVID strain in South Africa, currently called B.1.1.529.
Cases have been detected in South Africa, although the new strain has also been detected in Hong Kong, Botswana, Israel and Belgium.
To make matters worse, the new variant is spreading extremely quickly in South Africa.
Compared to the Delta and Beta variants that preceded B.1.1.529, cases of the new variant are increasing, according to data from Gisaid and the South African National Health Laboratory Service and published today in Financial Times.
This graph may sound alarming, but according to journalist Joseph Cotterill, who covers South Africa, “it is unclear” how the new variant is surpassing the previous variants.
“South Africa’s new cases, (and the positive test rate), have dropped to very low levels in recent weeks. There may not have been much to win the competition,” he said today.
Still, markets have had their say and remain firmly in the red.