IMPACT OF THE START OF THE CONVENTIONAL RUSSIAN-UKRAINIAN WAR ON THE VALUE OF THE MAJOR CRYPTOCURRENCIES IN 2022

Анотація

Introduction. The cryptocurrency market is relatively young, however, its impact on the development of the economy is significant due to the significant capitalization of the cryptocurrency market. According to the Index proposed by chainalysis.com, Ukraine is one of the world leaders in the adoption of cryptocurrencies. The dynamics of the price behavior of the main cryptocurrencies is extremely important for the economy of many countries, and for Ukraine, as a leader in Europe in this segment, it is critically important. Therefore, studying the impact of conventional wars on the price dynamics of cryptocurrencies is necessary for the effective development of the global economy. In our article, we will consider the impact of the start of the conventional Russian-Ukrainian war on the value of the Ether cryptocurrency.

The purpose of the article is to investigate the impact of the initial stage of the conventional Russian-Ukrainian war on the price dynamics of the Ether cryptocurrency.

Results. The start of the conventional Russian-Ukrainian war, which began on February 24, 2022, had various effects on individual components of the financial market: the Russian stock market collapsed; the excessive emission of national currencies in Ukraine and Russia led to their devaluation and inflation, and the emission of currencies that function as world money and the increase in the cost of energy and food provoked significant imbalances in the foreign exchange market and accelerated global inflation, which negatively affected the development of the money market; the increase in demand for cryptocurrencies led to an active growth in the value of the Ether cryptocurrency and its prevalence. However, it should be noted that a month and a half after the start of the acute conventional Russian-Ukrainian military-political confrontation, the global economy adapted to the war, which, in turn, led to a decrease in their value.

Conclusions. From the research, we can conclude that the price of cryptocurrencies actively reacts to the wars taking place on the planet. We found that the beginning of the conventional Russian-Ukrainian confrontation led to a sharp increase in the price of the Ether cryptocurrency at the beginning of the war, but after the global economy adapted to this crisis, the value of the cryptocurrency began to gradually decrease. However, it should be noted that due to the relatively short historical period of the existence of cryptocurrencies, the impact of the conventional war on the development of cryptocurrencies has not been sufficiently studied, and the study of this impact will require its reflection in new economic studies.