The recent missile attack by Iran on Israel has instilled fear in global markets, including cryptocurrencies. Bitcoin price is declining as tensions rise in the Middle East between Iran and Israel, leading investors to seek safety in gold and crude oil, which are both climbing, thus sparking discussion about the status of the cryptocurrency as a safe-haven asset.
Following the escalation, Bitcoin dropped to $60,315 from $64,000 within a few hours before moving up to $61,800. A total of 154,000 traders were liquidated, and the total liquidation was $521 million.
Bitcoin Price Chart | Source: CoinMarketCap
As conflict in the Middle East intensifies, market uncertainty is causing volatility in not just cryptocurrencies but also in commodities such as gold and oil.
According to Goldprice.org , Gold was up by 1.4% on October 1 to $2,665 per ounce, which was close to the record high, while crude oil increased by 7% to $72 per barrel. People have sought refuge in gold and bonds when the market is volatile, especially when an airstrike occurred in various areas in Israel.
Li Xing, the Financial Markets Strategist Consultant to Exness, pointed out that the conflict has shifted investors to gold making it more attractive. However, bitcoin, considered a safe-haven instrument, declined by more than 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.
For now, the price of Bitcoin is still linked to the overall economic situation, which is still unpredictable.
