The Taliban Takeover of Kabul Affecting the Cryptocurrency Market
Bitcoin has already had a wild year, gaining and losing tens and thousands of dollars in value over the course of a few months. But the ride isn’t over for everyone’s favorite cryptocurrency, and the latest shocks to its system might stem from an unexpected source.
Anyone checking the news recently will have seen the harrowing scenes of the Taliban’s re-conquest of Afghanistan. What you likely haven’t seen is the impact that this titanic historic event has had on the cryptocurrency market. Yep, that’s right, even this has sent reverberations around the wild world of bitcoin.
So let’s dive in and see what those reverberations mean!
The Impact on the Stock Market
Of course, an event so tightly intertwined with global perceptions of the USA has affected American stock markets. The fluctuations of the stock market can ripple outwards. That might upend the bitcoin market and cryptocurrency industry more generally.
Since the fall of Kabul, stock futures have been trending lower as geopolitical uncertainty bites. There’s a chance that downturn could spill over into the cryptocurrency market.
With the number of traditional investors that have branched out into crypto in the last few years, a chill is a distinct possibility.
On the other hand, the possibility of military conflict does have defense stocks rising. If these bullish investors splash more money around, there’s a potential for a cryptocurrency rally in future.
In general, though, the blow to stability and perceptions of American might are more likely to have a chilling effect on stocks than the opposite.
Afghanistan’s Scuppered Plans to Enter the Cryptocurrency Market
The pre-Taliban Afghanistan government had plans to enter the cryptocurrency industry itself. A couple of years ago, the government was exploring plans to raise billions of dollars for internal development. How? through the issuance of sovereign crypto bonds.
Of course, those plans are ash and smoke now.
The withdrawal of an entire country from crypto can only have negative effects on the broader crypto and bitcoin market. Without the Afghanistan government trying to raise billions of dollars on the back of crypto bonds, the market as a whole suffers.
Readers curious as to why a government would get involved in crypto should take a look at this breakdown of bitcoin on www.bytefederal.com.
That could easily lead to a fall in the price of cryptocurrencies in general. Afghanistan is hardly an economic superpower, so the potential impacts are slight, but they are nevertheless there. Investors should take note.
The Fluctuations Continue
With or without the events in Afghanistan, crypto is sure to continue fluctuating regardless. After all, the cryptocurrency market has never been for the faint of heart. But still, global instability should give everyone pause for thought before they invest.
After all, with all the uncertainty in the world right now, who knows what can happen?
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