Bitcoin Falls As Markets Prepare For Iran War Crash
The bitcoin price has experienced a significant decline, falling towards $60,000 per bitcoin and shedding nearly 5% within just a few minutes. Bitcoin’s sharp decline coincides with Israel’s military actions against Iran, with reports indicating U.S. involvement in the offensive, as per sources. On Saturday morning local time, Israel executed what it termed a “preemptive strike” against Iran, as stated by the country’s defense minister, Israel Katz, according to reports. “Bitcoin just dropped off a cliff,” one bitcoin and crypto market watcher posted to X, adding that “Monday will be a bloodbath in the market [as the] flight to safety will accelerate.”
The bitcoin price has not aligned with gold in recent months, undermining its status as an emerging safe haven asset often dubbed digital gold. In the lead-up to the attack, analysts were busy speculating on the potential implications of a war with Iran for bitcoin, gold, and stocks. “From a macroeconomic perspective, any direct confrontation could disrupt energy markets and push oil prices higher, exerting upward pressure on inflation and limiting central banks’ room for maneuver.” Rania Gule said “In such an environment, investors tend to reduce exposure to volatile assets, increase liquidity holdings, or shift toward traditional safe havens.”
“Some estimates suggest that gold could rise by around 15% within two weeks in the event of a direct conflict, targeting a range between $5,500 and $5,800 per ounce.” Regardless of whether these projections come to fruition, the takeaway is unmistakable: during times of existential risk, investors gravitate towards assets that have a proven track record of preserving value. In this context, it is my view that bitcoin—regardless of the ‘digital gold’ narrative—has yet to demonstrate its effectiveness as a safe haven amid significant geopolitical upheavals. Its recent behavior suggests that it continues to be valued as a high-beta risk asset, highly responsive to global liquidity movements.
