If a war breaks out in the Middle East, Bitcoin may experience significant short-term fluctuations, but in the medium term, its trend needs to be analyzed based on multiple influencing factors:
⚡ Short-term panic drop (higher probability)
Risk asset nature: In the early stages of war, market panic spreads, and Bitcoin, as a high-volatility asset, is often sold off for cash or gold. For example, on the day Russia and Ukraine went to war in 2022, BTC plummeted by 10%.
Liquidity crisis: If the conflict drives up oil prices and triggers global inflation, expectations for Federal Reserve interest rate hikes may rise, causing funds to withdraw from high-risk assets, which would drag down Bitcoin.
🛡️ Medium-term hedging attribute may dominate
Demand for fiat currency alternatives: If the war leads to capital controls in the Middle East or local fiat currency devaluation, Bitcoin may become a "digital escape route." For instance, during the Russia-Ukraine war, the fiat currency purchase volume of BTC in Ukraine and Russia surged by 3-8 times.
Acceleration of de-dollarization:
War may weaken the dollar's credibility or lead to a break in the sanctions chain, causing capital to turn to Bitcoin to hedge against sovereign currency risks.
⚖️ Key variables
Scale of the war: Local conflicts, such as limited exchanges of fire with Iran, are beneficial for BTC; a full-scale war leading to nuclear threats would be detrimental.
U.S. policy: If the Trump administration seizes the opportunity to promote "cheap troop withdrawals, weakening U.S. military presence in the Middle East, or strengthening Bitcoin's position as a safe haven.
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