Bitcoin Surges for Second Day With Crypto in Demand as a Haven By

(Bloomberg) — extended a two-day rally, leading broad-based gains in cryptocurrencies as digital assets reasserted themselves as haven assets — and emerged as a potential vehicle for getting around sanctions — amid the intensifying war between Russia and Ukraine.

The largest digital coin by market value rose as much as 8% Tuesday to $44,964 in New York trading hours, with its rally over the past two sessions adding 20% to its market value at one point and its total market capitalization crossing above $840 billion once again. Other cryptocurrencies also advanced, with Ether crossing above $3,000. It also broke above its average price over the last 50 days, typically seen as a bullish development. 

Analysts watching the market say the stunning breakthrough can be ascribed to the idea that cryptocurrencies could act as a type of refuge as the war in Ukraine intensifies. Its appeal lies with the fact, the argument goes, that cryptocurrencies are detached from governmental control and therefore not beholden to any of their actions. 

Bitcoin “has gold-like properties in that if you hold it you directly control the assets as opposed to governments and banks being in between,” said Stéphane Ouellette, chief executive of FRNT Financial Inc. “In a period where banking is destabilized in a region, which is obviously happening in Europe right now, it would make sense to see some flows into BTC as people diversify away from the banking system,” he said, adding that speculators can get in front of such trends, which can drive prices higher.

A fresh wave of turbulence hit global markets on Tuesday as the war in Ukraine intensified amid mounting penalties against Russia. Russian troops continued to shell military and civilian facilities alike, Bloomberg News reported, as Ukraine’s President Volodymyr Zelenskiy accused Russian forces of committing acts of terror, and as the Kremlin stepped up its offensive despite a barrage of sanctions directed at Moscow. 

The rally is about “the utility of these assets to serve as a potential workaround for Russia sanctions and also a point of proof that virtual currencies are viable alternatives to fiat currencies like the Russian ruble,” said Nicholas Colas, co-founder of DataTrek Research.

Stocks in Europe fell along with U.S. equities, with the declining for the second straight day. Wall Street’s fear gauge, the , also spiked.

Many analysts have long posited that Bitcoin can be a useful asset during geopolitical turmoil. Its outperformance amid the volatility has some bulls pointing to a break from the narrative that crypto is just another risk asset. Adam Farthing, chief risk officer for Japan at crypto trading firm B2C2, said Bitcoin could “de-link from risk” and start trading more like a hedge to geopolitical instability and inflation.

“Bitcoin saw a significant upward move today as it appears to have…