Do military conflicts affect the value of crypto?
After Israel declared a state of war with the Palestinian militant organization Hamas, rumors swirled about the potential impact on Bitcoin and the broader altcoin markets
After Israel declared a state of war with the Palestinian militant organization Hamas, rumors swirled about the potential impact on Bitcoin and the broader altcoin markets.
Miles Deutscher, a renowned crypto analyst, recently shared his thoughts on X (formerly Twitter) about the potential impact of the Israeli-Palestinian conflict on the S&P 500 Index. Deutscher said historical data shows that markets tend to recover quickly from geopolitical shocks, despite initial volatility.
Since the cryptocurrency market is still highly correlated with the sp500 index, it is logical to assume that cryptocurrencies show strong volatility during military conflicts. However, historical data suggests that markets partially recover within three months of a conflict and show positive dynamics within a year of a conflict.
On February 24, the price of Bitcoin dropped by 8% to $34.3 thousand after the start of the military operation in Donbass
Trader, Russian cryptocurrency expert and CEO of Rocket PR Oksana Belyanskaya believes that the relationship between military conflicts and cryptocurrency is deeper than a simple correlation between the volatility of stock and cryptocurrency markets.
The nature of conflict and violence in the world has changed significantly over the past 75 years. Modern conflicts have become less lethal and more often occur in the form of hybrid wars, which include the use of cyber attacks and information.
Potential impacts of the war on the cryptocurrency market: 1) Change in investment behavior: During times of military conflict, investors usually tend to reallocate their assets and investments to more stable and safe assets such as gold or fiat currencies. This could lead to decreased demand for cryptocurrency and lower prices.
2)Increased volatility: War can cause instability in the global economy and financial system. Cryptocurrencies, as assets, tend to react more sensitively to such changes and may experience increased volatility. It is possible that cryptocurrency prices will fluctuate within a wider range.
3) Changing Regulatory Policies: During times of war, states may change their cryptocurrency regulatory policies.
Some countries may tighten controls over cryptocurrency transactions, limit or prohibit their use.
On the other hand, military conflicts create demand for cryptocurrency
4) Anonymous transactions allow you to buy weapons and move funds relatively anonymously, which is important during military conflicts
5) The demand for cyber and information attacks during military conflicts makes cryptocurrencies a more attractive means of payment for such activities
6) Residents of the countries involved in the conflict actively use cryptocurrencies to possibly increase their well-being (trading) and transfer cryptocurrencies to other countries under sanctions
CEO of Rocket PR Oksana Belyanskaya believes that the impact of military conflicts on the cryptocurrency market has not yet been fully studied, but they create both positive and negative impacts on the demand for cryptocurrencies in the market and, in general, regulators are tightening their policies using these pretexts
Miles Deutscher, a renowned crypto analyst, recently shared his thoughts on X (formerly Twitter) about the potential impact of the Israeli-Palestinian conflict on the S&P 500 Index. Deutscher said historical data shows that markets tend to recover quickly from geopolitical shocks, despite initial volatility.
Since the cryptocurrency market is still highly correlated with the sp500 index, it is logical to assume that cryptocurrencies show strong volatility during military conflicts. However, historical data suggests that markets partially recover within three months of a conflict and show positive dynamics within a year of a conflict.
On February 24, the price of Bitcoin dropped by 8% to $34.3 thousand after the start of the military operation in Donbass
Trader, Russian cryptocurrency expert and CEO of Rocket PR Oksana Belyanskaya believes that the relationship between military conflicts and cryptocurrency is deeper than a simple correlation between the volatility of stock and cryptocurrency markets.
The nature of conflict and violence in the world has changed significantly over the past 75 years. Modern conflicts have become less lethal and more often occur in the form of hybrid wars, which include the use of cyber attacks and information.
Potential impacts of the war on the cryptocurrency market: 1) Change in investment behavior: During times of military conflict, investors usually tend to reallocate their assets and investments to more stable and safe assets such as gold or fiat currencies. This could lead to decreased demand for cryptocurrency and lower prices.
2)Increased volatility: War can cause instability in the global economy and financial system. Cryptocurrencies, as assets, tend to react more sensitively to such changes and may experience increased volatility. It is possible that cryptocurrency prices will fluctuate within a wider range.
3) Changing Regulatory Policies: During times of war, states may change their cryptocurrency regulatory policies.
Some countries may tighten controls over cryptocurrency transactions, limit or prohibit their use.
On the other hand, military conflicts create demand for cryptocurrency
4) Anonymous transactions allow you to buy weapons and move funds relatively anonymously, which is important during military conflicts
5) The demand for cyber and information attacks during military conflicts makes cryptocurrencies a more attractive means of payment for such activities
6) Residents of the countries involved in the conflict actively use cryptocurrencies to possibly increase their well-being (trading) and transfer cryptocurrencies to other countries under sanctions
CEO of Rocket PR Oksana Belyanskaya believes that the impact of military conflicts on the cryptocurrency market has not yet been fully studied, but they create both positive and negative impacts on the demand for cryptocurrencies in the market and, in general, regulators are tightening their policies using these pretexts