Bitcoin rebounded from a sharp decline triggered by heightened geopolitical tensions, and bounced back again as conditions eased. After plummeting more than 6% to $59,643 on Friday morning, the digital asset was stable at around $64,450 as of 8:53 a.m. in London. Other cryptocurrencies such as Ether, Solana, and Dogecoin have also found stability.
Israel’s retaliatory strike against Iran following Tehran’s recent rocket and drone attacks shook global markets. But a report reaffirming the safety of the Isfahan nuclear facility has helped alleviate some concerns. Traditional safe assets such as bonds, gold and the dollar pared gains, while stocks and U.S. stock futures recovered from intraday lows.
Even amid the Middle East conflict, attention is focused on the Bitcoin halving event scheduled for later Friday, which will reduce the supply of new tokens.
Historically, halvings have caused Bitcoin prices to rise. However, this time, Bitcoin hit an all-time high in mid-March ahead of the event, raising questions about whether its potential impact has already been reflected in the market.
Stefan von Haenisch, head of trading at OSL SG Pte, noted that the ongoing Israel-Iran violence could create a “general risk-off sentiment across cryptocurrencies.” Nonetheless, he believes a “significant pullback” will be needed to reverse the optimism surrounding the halving.
Analysts at JPMorgan Chase & Co. and Deutsche Bank AG suggested the four-year halving cycle has already been largely priced in by investors. Ahead of the event, a group of three-month-old spot Bitcoin exchange-traded funds in the United States recorded net outflows for five consecutive days.
Featured Image: Freepik
Please see disclaimer