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Bitcoin kept advancing on Tuesday, briefly trading above $44,000 for the first time since February 17 amid mounting signs that the war in Ukraine is bolstering demand for cryptocurrencies.
The largest cryptocurrency rose as much as 6 per cent to $44,183 and traded at $43,400 at 12.54pm in Hong Kong, gaining along with other major digital tokens.
Bitcoin has leapt since Russia's military offensive in Ukraine, bolstered by people in those countries looking to store and move money in anonymous and decentralised cryptocurrencies.
Bitcoin trading denominated in the Russian rouble went into overdrive when the offensive began on Thursday, with daily volumes rising 259 per cent from a day earlier to 1.3 billion rouble ($13.1 million), figures from CryptoCompare show.
In Ukraine, meanwhile, cryptocurrency exchange Kuna's daily trading volume more than trebled to 150m hryvnias ($5m).
Bea O'Carroll, managing director at Radkl, a digital asset investment company, said the war and Western sanctions had seen a trend emerge of Bitcoin being used to transfer value.
"Basically, having a currency that is not controlled by the government, that is not affected by the emergency acts ... is really interesting," she added.
"Maybe this is how Russia gets its value moved around. Equally, on the other side, there was 'this is how people are going to get value to the Ukrainians'."
In the five days since Russia's offensive in Ukraine on February 24, Bitcoin has risen 13 per cent, while the S&P 500 US stock index that it often mimics is up around 2 per cent and traditional safety play gold is now largely flat after gaining as much as 3.5 per cent on the day of the invasion.
On the day of the attack, about $300m short Bitcoin positions were liquidated, Coinglass data showed, while Singapore-based QCP Capital said "a good portion" of leveraged long positions had been taken out.
As well as being largely anonymous, cryptocurrency holdings and transactions are often held in wallets on decentralised platforms that can be accessed from anywhere.
"Bitcoin could be a potential safe haven for Russian oligarchs avoiding sanctions as there will be no censor on the Bitcoin network and on cryptocurrency transactions," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
"Cryptocurrencies could act as a powerful store of value for a major part of holdings that don't need to be liquid."
Yet for cryptocurrency fans, the fact that such holdings could offer a route around sanctions could be a double-edged sword.
"It could lead to regulations from Nato countries against usage of crypto, but the flip side is that there could be broader adoption in places with geopolitical turmoil," said Katie Talati, head of research at digital asset manager Arca.
Ukraine was also quick to spot an opportunity in the cryptocurrency world's reach and anonymity.
Vice prime minister Mykhailo Fedorov tweeted the wallet addresses of Bitcoin and Ether, alongside an appeal: "Stand with the people of Ukraine. Now accepting cryptocurrency donations."
Mr Fedorov's government and Ukrainian non-governmental organisations raised more than $22m in cryptocurrencies after the appeals, according to blockchain analysis company Elliptic.
While Bitcoin may be emerging as a currency of choice in areas of geopolitical risk, however, market players caution there are differing views over whether it can more broadly become a "safe-haven" asset, a form of digital gold.
For Zach Friedman, co-founder of cryptocurrency brokerage Secure Digital Markets, Bitcoin's post-military offensive gains serve to enforce the "narrative around its store of value during turbulent times".
As of Friday, stablecoin transactions comprised more than 83 per cent of the total cryptocurrency market's 24-hour trading volume, according to CoinMarketCap.
USD Tether, the largest stablecoin saw its market capitalisation climb to an all-time high of nearly $80bn, while gold-backed cryptocurrency PAX Gold added nearly $100m to its market cap in two days.