Bitcoin has rebounded since heightened geopolitical tensions that initially triggered a sharp decline in the cryptocurrency.
The digital asset briefly fell more than 6% to $59,643 on Friday, but later stabilized and reached $64,640 by 10:55 a.m. in New York. Other tokens like Ether, Solana, and meme crowd favorite Dogecoin have also regained stability.
Israel’s retaliatory strike against Iran sent ripples through global markets less than a week after Tehran’s rocket and drone attacks. A report indicating the safety of Iran’s Isfahan nuclear facility has helped alleviate some concerns. Traditional safe assets such as bonds, gold and the dollar saw their gains decline, while stocks recovered from intraday lows.
The ongoing conflict in the Middle East is overshadowing the Bitcoin halving scheduled for later Friday, which will reduce new supply of the token. Historically, halvings have caused Bitcoin prices to rise. However, with Bitcoin reaching an all-time high in mid-March before the event, it is questionable whether the expected impact has already been reflected in the market.
Stefan von Haenisch, head of trading at OSL SG Pte, suggested that ongoing violence between Israel and Iran could trigger a general risk-off sentiment across cryptocurrency markets. Nonetheless, he noted that a significant downward move may be needed to reverse the optimism surrounding the halving.
Strategists at JPMorgan Chase & Co. and Deutsche Bank AG noted that the four-year halving cycle has already been largely priced in by investors. Ahead of the event, a three-month-old spot Bitcoin exchange-traded fund in the United States recorded net outflows for five consecutive days.
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