Harmony ONE Prices Soar In Volatile Crypto Market After Ukraine Invasion in Feb 2022

2 min read

With the Russian invasion of the Ukraine, many financial markets have seen a huge down turn.  But in a surprising twist of events this week, crypto blockchains: Ethereum, Polkadot and Harmony have all turned green.

What happened

This week has been a rather historic one, with the Russian invasion of Ukraine putting investors on edge. This invasion has impacts that span far beyond financial markets. However, looking at how cryptocurrencies reacted to this news, this asset class is clearly one that investors don’t feel comfortable holding through times of high uncertainty.

That said, Ethereum ( ETH 12.69% ) and two layer-2 Ethereum scaling networks Polkadot ( DOT 9.14% ) and Harmony ( ONE ) have made up most, if not all, of the ground lost this week on the invasion news. Investors seem to be pricing in the potential for talks between Russia and Ukraine to commence, which may signal an end to the fighting, and therefore an end to this market uncertainty. Accordingly, Ethereum and Polkadot have actually turned green over the past seven days, with Polkadot down less than 5% over this period. That’s a remarkable comeback for these top tokens.

Various digital-looking cubes connected in a chain.

Image source: Getty Images.

As of 10 a.m. ET on Saturday, Ethereum, Polkadot, and Harmony had gained 3.6%, 12.2%, and 14.8%, respectively, over the past 24 hours. This move is a strong continuation of strength seen during previous trading sessions, as investors appear to be turning more optimistic about the crypto sector as a whole.

Ethereum also got a boost on Thursday when the network announced its scaling testnet zkEVM has been launched. This testnet aims to tackle some of the scaling issues that have plagued the Ethereum network of late. Polkadot and Harmony, layer-2 scaling solutions, weren’t phased by this announcement, with investors seemingly betting on continued growth in the realm of decentralized finance pushing forward the need for additional scaling solutions over the long term.

So what

This geopolitical environment is one that has certainly provided for outsized volatility in many markets. For cryptocurrencies, which are already inherently volatile, this has meant a much more exciting (if you can call it that) rollercoaster ride for investors. This week’s events signal just how crypto investors need to accept volatility, particularly in uncertain times like these.

This Ethereum testnet news is a big deal, in how the entire Ethereum ecosystem may be reshaped moving forward. As Ethereum moves toward the completion of its upgrades that would bring Ethereum 2.0 to the world, how this will reshape the existing need for scaling solutions remains unclear. That said, it appears investors are taking the view that Polkadot and Harmony both provide utility, and will likely continue to play a role in helping scale the Ethereum network, even after Ethereum is fully upgraded to a sharding-capable network.

Now what

Ethereum, Polkadot, and Harmony provide the kind of intra-day volatility that make most stomachs churn. Zooming out, these tokens haven’t moved much over the past seven days. Accordingly, those taking the long-term view of these tokens, choosing to do nothing, have been rewarded.

However, this intra-day volatility is something to keep in mind, as the market recalibrates its expectations for these networks moving forward. This Ethereum testnet news to drive underperformance with Polkadot and Harmony, something that didn’t take place. Accordingly, these three tokens are ones to be watching closely from here.

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