The possibility of a full-blown war between Iran and the United States has triggered a cryptocurrency boom in the Middle Eastern country. The details around the “crypto spring” in Iran come from the Nikkei Asian Review.
After the January 3rd killings of the Iranian military commander Quasem Soleimani, Bitcoin’s price has increased by 4%, realizing 15% gains since the event. Overall, crypto prices have increased on average, and the VIX index (market volatility) has decreased.
Another interesting fact that the Nikkei Asian Review looks at is the surge of around 30% in the price of “privacy coins” such as Monero and Dash, since January 3rd. Another fact is that mainstream assets have slipped in value, while crypto ones have increased slightly.
As noted by analysts and some investors, people have started viewing the cryptocurrencies as hedge tools against any market “mishaps” and cycles – an asset that is close to how gold is usually used – as a hedge. Cryptocurrencies, with some exceptions, do not fall under sovereign interference and hence are no subject to geopolitical risks.
For example, in the case of Iran, Bitcoin is not related in any way to the US and its value is not determined by the rising tensions between the two countries.
While some investors may argue that cryptocurrencies are the new “gold” other experts do not believe that. The following quote comes from the Nikkei Asia Review and a comment from Christopher Flinos, a trader at Hayvn Capital, an Abu Dhabi-based company.
We are right in the middle of a big geopolitical event, and we have studied the data but found no real correlation or evidence of any of these [crypto] coins behaving in a gold-like manner.
More about Iran can be found here: