As a seasoned crypto investor with over a decade of market experience under my belt, I have learned to navigate the stormy seas of financial volatility with a steady hand and a level head. The recent drop in Bitcoin’s price, triggered by escalating tensions between Iran and Israel, has once again reminded me that the crypto market is not immune to geopolitical uncertainties.
The falling cost of Bitcoin coincides with escalating conflicts between Iran and Israel in the Middle East, causing investors to prioritize security by investing in gold and crude oil, which are currently experiencing growth. This situation has ignited debate about whether Bitcoin can be considered a reliable safe-haven asset or not.
In just a few hours, Bitcoin dipped from around $64,000 down to $60,315 before bouncing back up to $61,800. This sudden drop led to approximately 154,000 traders having their positions liquidated, totaling a staggering $521 million in losses.
As a crypto investor, I noticed on Goldprice.org that Gold surged by approximately 1.4%, reaching $2,665 per ounce – just shy of its record high. Meanwhile, crude oil prices jumped up by a substantial 7% to hit $72 per barrel. It seems that in times of market turbulence, people tend to flock towards gold and bonds as safe havens, as was the case following an airstrike in multiple locations across Israel.
In simpler terms, Li Xing, an advisor to Exness on financial markets strategy, noted that the ongoing conflict has led many investors to find safety in gold instead. Contrastingly, Bitcoin, often seen as a secure investment option, experienced a drop of over 3%.
Precious metals analyst Jesse Colombo told his X followers that Bitcoin and crypto fall during geopolitical fears, unlike precious metals. He said, “It’s yet another risk asset just like high-flying tech stocks.”
Blokland Smart Multi-Asset Fund manager Jeroen Blokland also recently opined that some investors are exiting Bitcoin to invest in gold, thus reviving the debate on whether Bitcoin is a safe-haven asset. Crypto analyst Jesse Colombo pointed out that it goes down during geopolitical concerns, unlike gold.
BlackRock CEO Larry Fink still believes that Bitcoin is a hedge against inflation, while Markus Thielen from 10x Research said that Bitcoin is still evolving and can be a gold replacement in the future, depending on the regulation.
At present, I’m finding that the value of my Bitcoin holdings seems to be closely tied with the broader economic climate, which remains somewhat uncertain and hard to predict.
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2024-10-02 08:36