Bitcoin, Ether Drop as US Deploys Troops to Eastern Europe

  • Crypto Markets Dropped Today On News That The US Will Be Deploying Troops To Eastern Europe
  • The euro zone’s annual inflation rate hit 5.1% in January, raising uncertainty about the overall strength of the economy

US troops deployed in Eastern Europe

President Biden has approved the deployment of about 3,000 US troops to Eastern Europe in an effort to protect NATO allies in the event of further Russian aggression. Markets fell sharply on the news, with bitcoin dropping as much as 5% and ether dropping as much as 5.7% on the day.

Traditional markets also reacted harshly to the news, with the S&P 500 falling as much as 0.50% at the start of trading hours, only to rally half a percent into the positive by the end of the day. The Nasdaq followed a similar trend falling about 0.4% and rising 0.8% later.

Eurozone inflation

Inflation around the world appears to be soaring as numbers roll in for the end of 2021. Recent year-over-year inflation numbers in the United States show that the CPI (industrial price index) consumption) and PCE (Personal Consumption Expenditure Price Index) rose to 7.1% and 5.8%, respectively.

Eurozone inflation figures show a similar trend, with consumer prices hitting 5.1% in January, a new record high. This trend is likely the result of an easing of monetary policy and increased economic stimulus in an effort to combat the economic downturn caused by the Covid-19 pandemic.

Although bitcoin has been touted as an inflation hedge and has performed well during the inflationary post-pandemic period, it is unclear how more intense inflation will affect the economy. If the prices of goods and services continue to rise at a faster rate than wages increase, fewer people will be able to afford to invest after paying for necessities.

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Profit Season

Meta (FB) is expected to release its earnings report today. The company has pushed further into the crypto industry over the past year, starting with its rebranding from Facebook to Meta and its commitment to the Metaverse. The company fell more than 20% in aftermarket trading ahead of its earnings call.

Go forward

Although there has been some positive news lately, such as India and Russia’s decision not to ban cryptocurrency and many businesses jumping on the crypto and metaverse bandwagon, a heavy uncertainty still hangs over the markets. Many investors seem to be waiting for the next Fed policy change to fight inflation.


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  • Luke Conway

    Editor, Evergreen Content

    As Evergreen Content Editor at Blockworks, Luke Conway oversees the creation of comprehensive educational guides on all things crypto to help users navigate the space. Prior to Blockworks, he worked as an associate editor for Investopedia, managing broker reviews and a cryptocurrency information desk.

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