Earlier this week, Bitcoin's (BTC) price sharply declined amid escalating conflict in Iran, leading to substantial volatility in the crypto market.
Recent Drop in Bitcoin Prices
Bitcoin's price fell to about $102,650 on Binance. This occurred alongside a roughly 5% rise in oil prices, indicating rising tensions in the Middle East. Amid the crisis, the crypto market and other risk assets faced sell-offs, while safe-haven flows into commodities like oil surged.
Historical Data and Predictions
Despite the recent dip, historical patterns suggest that Bitcoin may rebound. André Dragosch from Bitwise Europe noted that following the top 20 geopolitical risk events since 2010, Bitcoin has averaged a 64.6% increase over the following 50 days. For example, after the U.S.-Iran escalation in January 2020, Bitcoin gained about 20% in 60 days.
On-chain Metrics
CryptoQuant's data supports the notion that Bitcoin may be undervalued. The Puell Multiple, which compares daily miner revenue to its annual average, is currently around 1.3, below the 1.4 threshold. This indicates that current price gains are driven by demand rather than panic selling.
Given the current data and historical trends, the price correction may present an investment opportunity. Despite geopolitical uncertainties, analysts are seeing signs of a robust recovery for Bitcoin.