The recent escalation of the conflict between Israel and Iran has sparked discussions among traders and investors about whether Bitcoin is a safe haven.
Reasons for Bitcoin's Decline
Iran recently launched a barrage of missiles at Israel, which led to a $4000 decline in Bitcoin's price. Meanwhile, gold and crude oil prices rose as the threat of war in the Middle East increased. According to Goldprice.org, gold prices rose 1.4% to $2665 per ounce, while the price of oil rose 7% to $72 per barrel.
Historical Trends
Bitcoin has historically reacted to conflicts between countries. In 2022, cryptocurrencies fell after Russia invaded Ukraine, with Bitcoin dropping 7.9% to $34,324. The U.S.-China trade war from 2018-2020 also saw fluctuations in Bitcoin's price, depending on the intensity of the tensions. Additionally, during North Korea's missile tests in 2017, gold and Bitcoin prices surged.
Conclusion
Bitcoin often reacts to economic and geopolitical events, such as wars. Investors watch these events closely to understand their impact on their assets. The decrease in trust in Bitcoin due to such events drives some investors to bet on gold.
While predicting Bitcoin's future price behavior is difficult, current events demonstrate its sensitivity to geopolitical factors.
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