Bitcoin falls below $30k for first time in a month
Cryptocurrencies sink as delta variant triggers flight to safe havens
Cryptocurrencies sank on Tuesday, with Bitcoin falling below $30,000 for the first time in about a month.
Safe-harbor currencies like the yen and dollar traded near multimonth highs against the riskier Australian dollar and British pound on Tuesday, as fears grow that a rampant coronavirus variant could upend the global economic recovery.
In cryptocurrencies, Bitcoin sank as low as $29,500, a level not seen since June 22, before trading 4.1 percent lower at $29,559.10. Rival ether dropped 4.8 percent to $1,730.33, also nearing a one-month low.
The dollar touched an almost eight-month high of $0.7317 per Aussie on Tuesday before trading at $0.7319, and changed hands at $1.36625 to sterling after hitting the highest since early February at $1.3655 in the previous session.
The fast-spreading delta variant of the coronavirus is now the dominant strain worldwide, and has been accompanied by a surge in infections around the US, particularly in areas where vaccinations have lagged. Meanwhile, Boris Johnson’s “freedom day” — ending over a year of COVID-19 lockdown restrictions in England — was marred by surging infections and the British prime minister’s own forced self-isolation after Health Minister Sajid Javid tested positive for the virus.
In Australia, nearly half the country’s 25 million people are living under lockdowns to quell an outbreak of the delta variant.
“What is likely concerning markets now is ... a surge in infections occurring in developed markets with high levels of vaccination,” National Australia Bank analyst Tapas Strickland wrote in a client note. “That suggests virus restrictions may need to be in place for longer,” delaying the global recovery, he said.
The euro weakened 0.1 percent to $1.17885, after dipping overnight to the lowest since early April at $1.1764. The European Central Bank announces policy on Thursday with market participants keen to see how the monetary authority implements changes to its strategy unveiled earlier this month.
What is concerning now is a surge in COVID-19 infections in developed markets with high levels of vaccination.