The push toward $8,500 took place at the same time as mainstream media began to report on a retaliatory attack by Iran on the American forces based in Iraq.According to data from Google Trends, the search term "Bitcoin Iran" surged 4,450% in the seven days to Jan. 8, Cointelegraph disclosed.
Nigel Green, CEO of the United Kingdom's deVere Group, said on the matter: "This latest Bitcoin price increase underscores a mounting consensus that Bitcoin is becoming a flight-to-safety asset."
Will more investors flock to crypto now?"With an escalation in geopolitical turbulence, which typically unsettles traditional markets, it can be expected that a growing number of investors will decide to increase their exposure to decentralized, non-sovereign, secure currencies, such as Bitcoin," commented Green.
One might see heightened demand for Bitcoin after the past week of tensions in the Middle East "As investors in the region may look to move funds away from traditional investments such as gold or global bonds," Edward Moya, Senior Market Analyst at OANDA, told Cointelegraph.
"Bitcoin may have seen a bottom put in place, and some investors may feel more confident that Bitcoin can reach $10,000 a lot easier than gold can return to its 2011 record highs just above the $1,900 level."
Did the crisis confirm that Bitcoin has become a flight-to-safety asset?Green's assessment on Bitcoin becoming a flight-to-safety asset has some qualified support, but not all agree completely.
"Bitcoin at times has rallied alongside other well known safe-havens , but it is far from becoming a more traditional flight-to-safety trade. Bitcoin lost most of its safe-haven trade allure after regulatory concerns grew in both China and the U.S. in the last half of the past year."
"That's not to say that Bitcoin is perceived as a flight-to-safety asset, as Bitcoin is not considered a low-risk investment relative to gold or silver."
Bitcoin is living up to its reputation as "Digital gold," Green continued: It is a store of value like gold and is perceived as being resistant to inflation like gold, and, as a result, "It could potentially dethrone gold in the future as the world becomes increasingly digitalized."
Still, it seems clear that those who viewed crypto as a totally uncorrelated asset pre-crisis may have to reassess, given that the price of Bitcoin and other cryptos seemed to rise as world tensions ratcheted up, and subside along with the turmoil - much like gold and silver.
Crypto Community Eyes US-Iran Crisis As Tensions Flare
Published on Jan 14, 2020
by Cointele | Published on Coinage
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