Bitcoin fell nearly 8% on Friday after the discovery of a new, potentially vaccine-resistant coronavirus variant, with investors dumping riskier assets for the perceived safety of bonds, the yen and the dollar.
Bitcoin, the largest digital currency, fell 7.8% to $54,377, its lowest since October 12.
It was on track for its biggest one-day drop since September 20, and is down more than a fifth since hitting a record high of nearly $70,000 earlier this month.
The variant, found in South Africa, Botswana and Hong Kong, has an unusual combination of mutations and may be able to evade the immune response or make it more transmissible, scientists said.
“The spread of (the variant), especially in other countries, could further reduce investor appetite,” said Yuya Hasegawa at Tokyo-based exchange BitBank. “The upside of BTC is likely to be limited and the market should be prepared for further losses.”
Bitcoin hit an all-time high of $69,000 earlier this month as more major investors embraced the cryptocurrency, many of whom were drawn to its perceived inflation-resistant properties. Others have piled into digital tokens on the promise of quick profits.
Yet it remains highly volatile, questioning its suitability as a stable store of value.
The smaller coins that went with bitcoin also fell.
Ether, the second largest by market capitalization, fell 11.6 per cent to its lowest level in a week. It was last seen at $4,070, which is down about 18% from it’s all-time high on November 10th.
Bitcoin tumbles as coronavirus variant sees riskier assets dumped – Reuters https://t.co/zIgNXcqQ6A
— GigaɃitcoin (@GigaBitcoin) November 26, 2021