Crypto rout 'part of a larger global macro economic story,' CoinDesk editor says

Emily Parker, CoinDesk Global Macro Editor & CoinDesk TV Anchor, joins Yahoo Finance Live to discuss bitcoin and crypto volatility in congruence with traditional markets' trends, Russia's potential ban on crypto mining, and the Biden administration's outlook on the crypto space.

Video transcript

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- We're seeing cryptocurrency taking a major hit today, along with the broader market. And with Bitcoin-- Bitcoin hovering around that 30-- oh, around that $34,000 handle. Bitcoin and Ether down more than 50% from the all-time highs. Let's bring in CoinDesk Global Macro Editor and CoinDesk TV anchor Emily Parker. Emily it feels like there's not a lot of places to hide today, and Bitcoin's certainly no exception.

EMILY PARKER: That's absolutely right. As you just pointed out, this is part of a larger global macroeconomic story. We're seeing, you know, a crash in the overall market as well. And there is no place to hide, not just for Bitcoin, but a lot of the altcoins that are falling as well.

So this sort of challenges this narrative of Bitcoin being a unique asset because it is performing like stocks, and it also challenges the narrative of Bitcoin decoupling from altcoins because a lot of them are falling as well.

- And so as we were tracking some of those altcoins as well, I think even as we continue to kind of annex Bitcoin and Ether, given their top two cryptocurrency kind of market cap, at the end of the day, is this one of those moments where we could potentially see, coming out on the other side of this, that furthering of this idea of the flippening in the future? And how far off from that would we potentially be?

EMILY PARKER: Well, I mean, Ether has taken a pretty big hit, right? But so has everything. So I feel like it's just real-- I mean, right now we're just seeing all the coins kind of moving in tandem. And I just-- it's just really hard to know. Because in theory, all of these coins perform differently.

I mean, Ether performs very differently from Bitcoin. It's used for completely different purposes. It's fueling the NFT world. It's fueling the metaverse world. So these are completely different animals, but right now they are behaving in a similar way.

- We've got a number of other headwinds that investors are watching in the crypto space too, Emily. Number one, Russia considering an outright ban on crypto mining. And then you've got the Biden administration reportedly working on an executive order on cryptocurrencies. How do you think that's going to weigh on the price moves?

EMILY PARKER: Yeah, so let's start with Russia. So Russia has basically threatened to ban cryptocurrency trading and mining, which is a really big deal because Russia is an important cryptocurrency market, and it's also a really important center for cryptocurrency mining. We don't know if they're actually going to ban it, but they're threatening to.

And-- but the thing is, is I don't really think that that's the major driver behind the price crash because when we first heard the Russia news, actually Bitcoin briefly went up. So it didn't react immediately to the news from Russia. It kind of reacted later.

But yeah, I mean, if Russia actually does ban crypto, I think we will see a notable effect. It's interesting to think about why they might be doing it. It seems like one reason is potentially to stop crypto donations to opposition parties. So that's-- that is one possible motivation from the Russian government.

As for the Biden executive order, this is also quite interesting. We might see something like this quite soon. Basically, the Biden administration is addressing a very common criticism that the US has a lack of clarity on crypto policy. There's just too many agencies involved. Very few people understand who's in charge of what.

So this is an idea to get a little bit more of a cohesive approach to crypto at a federal level. So of course, it depends on actually what the results of this will be, but it could potentially be good for the industry.