For many years, Bitcoin has been advertised as a great medium of exchange, store of value, and the perfect hedge in times of global uncertainty. While arguments about all three are still raging today, the king coin has never really had a chance to prove itself as that perfect hedge, until now.
Just days ago, the U.S. government claimed responsibility for the killing of Iranian General Qassem Soleimani in a Baghdad airstrike. Since then, Iran as retaliated by firing missiles at military bases in Iraq, known to be occupied by U.S. soldiers. Also, there have been attacks at the U.S. Embassy in Iraq as well. But as all of this turmoil unfolds, Bitcoin has used the unrest as a springboard.
On Tuesday, Bitcoin shot past the $8,000 mark and almost reached $8,500. In addition, and for the first time in almost 2 months, Bitcoin scaled the 200-day moving average. For most of the market, it’s hard not to notice that this is happening in the middle of rising tensions. It’s also a little too much to be written off as a coincidence.
A tweet by analyst Willy Woo very easily highlights what many are thinking. Because there has not been this much international conflict in a long time, it has been somewhat difficult to determine Bitcoin’s usefulness at a time like this. Now Woo believes that Bitcoin has passed the test.
“I think Bitcoin just got its first successful beta test of being a war time safe haven, this is a pretty big test for Bitcoin.”
Gold has also not been left out. Yesterday, spot gold prices hit $1,603, a level not seen in almost 6 years. Gold futures also hit $1,605.80, jumping by about 2%.
Trump Dials Down
In an interesting speech by U.S. President Donald Trump, it was revealed that the U.S. will not be escalating tensions, at least for now. Trump suggested that even though Iran still made a few more attacks, he’d be fine with keeping things down.
Probably due to the announcement, both Bitcoin and Gold have reacted in one bound. Founder of crypto advisory firm Onchain Capital Ran NeuNer has boldly declared in a tweet, a similar opinion to that shared by Woo. NeuNer believes that it is now impossible for anyone to dismiss Bitcoin as the perfect investment channel in times like this.
“Whereas I would have preferred the BTC price to continue climbing, watching Bitcoin and Gold move down together on Trump’s speech cemented the fact that investors are truly moving into Bitcoin as a safe haven from political events. No investor can deny this any longer.”