On the back of the Ukraine – Russia conflict, massive volatility ensued in the financial markets across the world, with the US Dollar Index (DXY), oil and gold significantly rising in the process. Cryptocurrency and stock markets plummeted on the morning of February 24, 2022, based on the shocking events unfolding in Eastern Europe, before rebounding later in the night. Prior to that, Bitcoin seemed to have potentially reversed into a bullish mode on February 23, before the drama unfolded during the night in Eastern Europe. It fell $4000 from $38.8k to $34.8k, before reversing to original levels. The V-shape formed on the 4h Bitcoin chart is reminiscent of the Covid-triggered crash and subsequent revival in March and April of 2020, and it remains to be seen whether further resistances at $40k and the 50 EMA on the 4h chart would be broken. If Bitcoin were to descend, the debate would be on whether Bitcoin will breach the $30k level, in what could then be a potential liquidity grab in the market where smart money would be waiting in that region to kickstart a bullish reversal.
In terms of mining, the United States had been benefitting greatly from China’s prior ban on Bitcoin mining activities, as miners flocked to crypto-friendly environments in order to carry out their operations. In the United States, states such as Nebraska represent an attractive destination for miners due to the legal protection they offer for the private property of individuals and entities looking to establish businesses, despite relatively higher power and labour costs they would incur than in other countries.