Major cryptocurrencies slumped on Friday as a new coronavirus variant sparked concerns across the broader market.
Bitcoin (BTC-USD) was down 5.7% to trade at $54,629 (£41,007). It’s down about 20% from its all-time high of roughly $69,000, which it hit earlier this month.
Ethereum (ETH-USD), the world’s second biggest crypto by market cap, plummeted 6% and was trading at $4,051, even as US banking giant JPMorgan Chase (JPM) said the crypto could be a better investment than bitcoin.
“The rise in bond yields and the eventual normalisation of monetary policy is putting downward pressure on bitcoin as a form of digital gold, the same way higher real yields have been putting downward pressure on traditional gold,” the JPMorgan report said.
“With ethereum deriving its value from its applications, ranging from DeFi [decentralised finance] to gaming to NFTs [non-fungible tokens] and stablecoins, it appears less susceptible than bitcoin to higher real yields,” it added.
Read more: Global stock markets crash as new COVID variant spooks investors
Investors seem concerned about the new COVID-19 strain discovered in South Africa.
The World Health Organization is keeping an eye on this new variant with many alterations to the spike protein, as COVID cases increase in the run up to the holiday season.
The UK government said six African countries would be added to its travel ‘red list’, with flights being temporarily banned.
Farah Mourad, senior market analyst at XTB Crypto, told Yahoo Finance UK: “Markets are down as a global selloff seems to be underway and risk aversion increases.”
“Investors are trying to reduce their exposure in the face of the uncertainty surrounding the possible effects of the new COVID variant on the economy and the financial markets, and as…
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