Iran-Israel Tensions: Will Bitcoin Survive Against Gold?

Impossible for Bitcoin to remain stable in these troubled times. As the Middle East prepares for a potential conflict between Israel and Iran, investors are massively turning to gold. Immediate consequence: BTC drops by 2%, reaching $62,500, while gold climbs to $2,662 per ounce. Bitcoin’s volatility in the face of geopolitical tensions shows that gold remains the favorite safe haven for investors.

Israel vs Iran: Bitcoin in Turmoil

After a historic September for Bitcoin, another episode is unfolding. It concerns the growing tensions between Israel and Iran which have a direct impact on the crypto market. The announcement of an imminent missile from Iran against Israel caused a collapse in the price of BTC, falling below the $62,500 mark. 

Meanwhile, gold shines again, gaining 1% in value.  

Investors are literally selling #Bitcoin to buy #gold as geopolitical tensions spike. pic.twitter.com/ib7c38K75K

— jeroen blokland (@jsblokland) October 1, 2024

This situation reinforces the idea that Bitcoin has not yet acquired its status as a safe haven in times of crisis. As Jeroen Blokland points out in his tweet: 

“Investors are literally selling Bitcoin to buy gold”.  

Investors choose caution, preferring a tangible asset like gold in these moments of instability. While missiles are preparing to rain down, gold prices are rising, and BTC is in free fall.  

• Bitcoin drops by 2% to $62,500; 
• Gold increases by 1% to $2,662 per ounce;  
• The announcement of the Iranian missile against Israel triggered it.

A Crypto Market Under Pressure

Besides the Israel-Iran conflict, Bitcoin and the cryptocurrency market, in general, are also subject to other pressures. Ethereum (ETH), the second major player in the sector, saw its value drop below $2,600, down 2%. Binance Coin (BNB), on the other hand, plunged to around $550.  

This drop in Bitcoin and its crypto companions might just be a short-term retracement, as the market recently accumulated gains. However, the current volatility of BTC demonstrates how much geopolitical events influence its price. 

Other recent conflicts, such as the one between Russia and Ukraine, had also triggered significant fluctuations. The idea of a “digital gold” seems far away for now, especially when physical gold continues to rise.

And that’s not all. In addition to this crisis in the Middle East, Bitcoin also has to face the risks of an AI bubble and an economic recession.