What did we tell you all? Political unrest has a lot to do with bitcoin’s sudden rise to power. Now that relations between the United States and Iran are easing up a bit, it appears bitcoin has quickly descended back into the $7,000 range.
Bitcoin Is Falling Back Down
At the time of writing, the world’s number one cryptocurrency by market cap is trading for just over $7,800. While this is not a massive difference from yesterday’s $8,000, it’s still a punch in the gut. Many enthusiasts thought that the newfound bullish behavior striking bitcoin was likely to last longer than this.
At the same time, it’s been noted that the recent drone attack on Iran by the United States was likely the big instigator behind bitcoin’s quick jumps this past week, and now that things are starting to cool down, it makes sense that bitcoin would suddenly shrink back by several hundred dollars.
This is exactly what happened when President Donald Trump began instilling new tariffs on Chinese products being imported into the U.S. Bitcoin shot up along with gold, while global stocks fell to record lows. Weeks later, once the environment had cooled off a bit, bitcoin also began to descend. This is what happens; unrest causes spikes, while the aftermath – granted things remain peaceful – causes bitcoin to drop back down.
The big question now is, “How long will the bitcoin fall last?” Will we see further dips, or will the currency find a way to stabilize itself? Well, it’s a little too early to tell at this point, though it can be said that tensions between east and west have not fully eased up yet, so while bitcoin may incur a few more drops along the road, we’re not likely to see anything major happening in the immediate future.
The Environment Is Cooling
Some of the fear, speculation and emotion that was meandering through the space recently had to do with many crypto enthusiasts worrying about whether the world was on the brink of war. While this doesn’t appear to be the case, the United States has sworn to impose further sanctions on the nation of Iran. The latter country itself says it’s backing down for the time being, though the recent (failed) attack on U.S. military bases in Iraq still hang in the air.
So, while things are certainly calmer for the time being, the tension and worry have not fully dissipated. All we can do is sit back and wait to see what bitcoin does next. The currency’s latest move will likely help us better understand the position and potential stability of the crypto industry. Until then, sitting around and biting our fingernails over what might happen is not going to serve a significant purpose.