Bitcoin is making a big comeback Tuesday morning as political uncertainty out of Italy grips financial markets.

The cryptocurrency was trading up 4.8% at $7,446 a coin.

Watch bitcoin trade in real time here.

Crypto markets are making a big comeback as political uncertainty grips Italy and Europe.

At the time of writing, a number of major cryptos were sporting big gains, including ethereum and bitcoin cash. Bitcoin, the largest cryptocurrency by market capitalization, was trading up 4.8% at $7,446 a coin, according to Markets Insider data.

Bitcoin rallied close to $10,000 soon after the close of Tax Season in the US, but is down by more than $2,000 since the beginning of May.

Market observers noted that Tuesday's rally was occurring at the same time as political uncertainty in Italy gripped financial markets.

"Bitcoin finally catches a bid after Italian 2-year yield spikes 155bps – Italy’s new 5 Star party threatens exit from Eurozone which has once again put the Idea of a Euro breakup in the forefront of investors minds," John Spallanzani, a portfolio manager at Miller Value Partners, said in an email to Business Insider.

A deepening political crisis in the eurozone's third-largest economy, Italy, has been wreaking havoc in global markets Tuesday amid fears of renewed turmoil in the single-currency area.

On Sunday, Italy's president Sergio Mattarella declined to accept the nomination of euroskeptic Paolo Savona as economic minister. A national election in March resulted in a hung parliament and Italy has been running without a ruling government.

Outside of crypto, gold - which is often considered a safe-haven asset - rallied earlier Tuesday, but has given up those gains.

"To an extent, I think its good to see Bitcoin rallying with Gold, as the adverse developments in Italy and globally are pushing investors to risk-off," Tom Lee, the head of Fundstrat Global Advisers, said in an email. "It’s good to see Bitcoin as an uncorrelated trade on a risk off day."

Still, Lee pointed to market technicals as a key factor behind the crypto rally.

"I think weekend trading can create a lot of noise, especially over a long weekend, given poor liquidity, absence of active traders (especially holiday weekend) and therefore investors can try to exploit that lack of liquidity," Lee said.

"So in some ways, Bitcoin’s bounce today is a relief and supported by technicals as well."