Bitcoin enters bear market territory as risk assets plunge on new Covid variant

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  • According to data from Coin Metrics, bitcoin fell 7% over the past 24 hours to $54,561, its lowest level since October 8.
  • The cryptocurrency is down almost 20% from the all-time high of $69,000 that it hit earlier this month.
  • Bear markets are typically defined by a drop of 20% or more from recent highs.

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Bitcoin fell sharply on Friday along with other assets, hitting a six-week low and officially entering bear market territory.

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According to data from Coin Metrics, bitcoin fell 7% over the past 24 hours to $54,561, its lowest level since October 8. The cryptocurrency is down 20% from an all-time high of around $69,000 earlier this month.

Bear markets are typically defined by a drop of 20% or more from recent highs.

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Other cryptocurrencies also fell on Friday. Ether, the second-largest cryptocurrency, fell more than 10% to $4,007, while XRP fell 10% to nearly 95 cents.

Digital currencies are falling, along with other riskier assets, amid panic over a new, heavily-mutated version of the coronavirus first detected in South Africa.

The World Health Organization gave a briefing on Thursday on the new version, known as B.1.1.529 and believed to contain more than 30 mutations. Britain and other countries have temporarily suspended flights from six African countries in response.

Bitcoin is often described by its proponents as “digital gold”, a reference to the yellow metal’s status as a so-called safe haven asset.

Crypto investors say that the virtual currency provides a store of value as well as a hedge against inflation.

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