Bitcoin along with other cryptocurrencies soared on Monday following a sharp sell-off towards the end of last week. As per Coin Metrics data, the price of bitcoin jumped by around 6% during the last 24 hours to $57,373. Other digital currencies also increased with ether gaining 7% to $4,331 and XRP up 6% at almost 98 cents.

Head of Asia Pacific at cryptocurrency exchange Luno, Vijay Ayyar, said in an email, “We’re seeing news of the variant being potentially weaker in terms of symptoms in early analysis, which has bolstered the market comeback”. He added, “Hence, smart investors have probably bought this dip.”

Earlier last week, Bitcoin dipped as low as $53,549, which is its lowest level since early October, in the wake of a broader sell-off in stocks and other riskier assets due to fears over the new coronavirus variant.

The world’s largest digital currency briefly plunged by 20% from its recent all-time high of almost $69,000, officially entering into bear market territory. Generally, bear markets are defined by a decrease of 20% or more from recent highs.

The new variant, originally identified in South Africa, has spread to multiple countries including the U.K., Germany, and Italy.

The US, UK, and other nations have placed restrictions on travel from a number of African countries as a result of the emergence of the new variant. Britain has also implemented new measures to curtail the new virus mutation, which include mandatory mask-wearing in shops and public transport in England.

On Sunday, the South African doctor who first spotted the omicron variant, Dr. Angelique Coetzee, described its symptoms as “extremely mild,” easing fears of a potential return of lockdown restrictions during the holidays.

Ayyar said, “The global environment did add to the uncertainty across all risk asset classes as we saw last week, but the bounce back always shows us how strong the uptrend is, which is what we’re seeing here”.

If bitcoin loses $48,000 to $50,000 on a daily or weekly basis, “that would definitely imply bearishness,” he added. However, presently Ayyar says “we’re still in bull market territory.”

The story was filed by the News Desk.
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