- Bitcoin lost 8% on Friday to reach its lowest level in two months as cryptocurrencies fell across the board.
- The discovery of a new, potentially vaccine-resistant COVID-19 variant caused investors to dump more risky assets.
- Metavers-linked coins plunged and reversed a recent rally as sand fell 4.2% and mana lost 10.8%.
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Bitcoin, ether and metaverse-linked coins, mana and sand, were all knocked down in a broad-based crypto sale on Friday as concerns about the impact of a new COVID-19 variant prompted investors to sell more risky assets.
Leading cryptocurrency bitcoin fell 7.5% in 24 hours to reach $ 54,079 at. 08:50 ET, according to CoinMarketCap data. But it was smaller losses recorded earlier as it fell to $ 53,625 – the lowest level since October 10th. The tokenet is now heading for its biggest drop in one day in two months.
Researchers in South Africa said on Thursday that they had discovered a new COVID-19 variant, number B.1.1.529, that could be more transmissible and more resistant to current vaccines. In response, Britain suspended flights from six South African countries and the EU said it was considering a similar no-fly zone.
The World Health Organization plans to hold a special meeting on the situation on Friday, after warning of the rise in global coronavirus cases earlier this week.
The measures spurred fears of new anti-pandemic restrictions and their impact on economic growth, which rattled global stock markets as investors sought shelter in less risky assets. That tone was reflected in the crypto markets, analysts said.
“Today’s move shows that digital assets are susceptible to risk aversion hitting traditional markets,” Freddie Evans, sales trader at digital asset broker GlobalBlock, told Insider in an email.
“We have seen large global indices and other risk assets hit by concerns about the emergence of a new Covid variant in South Africa, which in turn has affected bitcoin, causing $ 300 million to be liquidated within an hour,” he said.
Meanwhile, ethereum’s native token ether fell 9.5% in 24 hours to $ 4,027.06, but also withdrew from a major loss. Earlier, it fell to $ 3,933, the lowest level since October 24.
Among altcoins, solanas sun fell by 10.8%, polkadot fell 12.5%, and cardanos ada lost 9.6% in the last 24 hours. In terms of meme coins, dogecoin fell 8.2% while shiba inu fell 1.6% according to CoinMarketCap data.
Metaverse-linked tokens also got a hit and came from gains recorded this week amid positive news such as digital property selling for millions of dollars. The gaming platform Sandbox’s sand token fell 2%, while the virtual real estate provider Decentraland’s mana token fell 6.3% according to CoinMarketCap.
Despite the general decline in cryptocurrencies, not all market observers were discouraged by the outlook for prices.
“For us at 21Shares, the fundamentals of cryptocurrencies have not changed. We see that the pace of innovation continues to move forward and at an accelerated level,” said Eliézer Ndinga, research manager at digital asset manager.