Bitcoin (BTC) enters the bear market on new Covid variant

Bitcoin prices fell sharply amid global divestments of shares.

Luke MacGregor | Bloomberg | Getty Images

Bitcoin fell sharply with other assets on Friday, hitting a six-week low and officially entering bear market territory.

Bitcoin fell 7% in the last 24 hours to $ 54,561, according to Coin Metrics data, its lowest level since October 8. The cryptocurrency has fallen 20% from a record high of almost $ 69,000, as it hit earlier this month.

Bear markets are typically defined by a decline of 20% or more from recent highs.

Other cryptocurrencies also fell on Friday. Ether, the second largest crypto, fell more than 10% to $ 4,007, while XRP fell 10% to around 95 cents.

Digital currencies are falling in line with other risk assets in panic over a new, highly mutated variant of the coronavirus that was first discovered in South Africa.

The World Health Organization on Thursday issued a briefing on the new variant, which is known as B.1.1.529 and is believed to contain more than 30 mutations. Britain and other nations have temporarily suspended flights from six African countries in response.

Bitcoin has often been described by its supporters as “digital gold”, a reference to the status of the yellow metal as a so-called safe haven asset.

Crypto-investors say the virtual currency offers a stock of value as well as a hedge against inflation.

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