In January 2022, Bitcoin hit a six-month low at $32k but has made a 10% recovery since then. This is the lowest price the coin has been at since July 2021. Entering the bear market, crypto enthusiasts fear that a crypto winter might just become a reality.
The coin lost 54% of its value in under a month and the recovery has been slow, to say the least, with the US Federal Reserves hiking interest rates to battle the inflation that has been going on. In December of 2021, inflation was at 7%, which hasn’t been seen in the country since the 80s.
Many market analysts have attributed these two things to the downfall. The first is the new interest rate hikes by the US Federal Reserve. They have been doing this to battle inflation and the second is the deteriorating ties between the USA and Russia.
The geopolitical tension between the both due to Ukraine now being annexed by Russia has irked the USA. Not only is it against the UN conventions, but Russia has been taking over the continent slowly but surely. This rise in the power of Russia and the current ban on cryptocurrencies have heightened the geopolitical tensions between them.
Now Russia aims to ban all crypto-related activities too after there have been mining incidents in the country. Last year a town had a power shortage due to miners using more power than that was available Latoken, a Russian crypto exchange has also come under heavy fire for scandalous activities.