Bitcoin Collapses As Coronavirus Variant Shakes Markets

A representation of the virtual cryptocurrency Bitcoin can be seen in this image, taken on Oct. 19, 2021. REUTERS/Edgar Su/File Photo/File Photo

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LONDON, Nov. 26 (Reuters) – Bitcoin fell nearly 8% on Friday after the discovery of a new, potentially vaccine-resistant coronavirus variant, leading investors to dump riskier assets for the perceived safety of bonds, the yen and the dollar.

Bitcoin, the largest digital currency, fell a whopping 7.8% to $54,377, its lowest level 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.

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Scientists said the variant, detected in South Africa, Botswana and Hong Kong, has an unusual combination of mutations and could potentially evade immune responses or make it more transmissible. read more

“The spread of (the variant), especially to other countries, could further curb investors’ appetites,” Yuya Hasegawa said at the Tokyo-based exchange Bitbank. “The benefit of BTC is likely to be limited and the market should brace for further loss.”

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Bitcoin hit an all-time high of $69,000 earlier this month as more major investors embraced cryptocurrencies, with many drawn to its alleged inflation-proof properties. Others have piled into the digital token with the promise of quick profits.

Yet it has remained highly volatile, raising doubts about its suitability as a stable store of value.

Smaller coins, which tend to move in tandem with bitcoin, also fell.

Ether, the second largest by market cap, fell a whopping 11.6% to its one-week low. It was last at $4,070, nearly 18% lower than the record hit on November 10.

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Reporting by Tom Wilson; adaptation by Carolyn Cohn and Kim Coghill

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