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Bitcoin plummeted over the weekend following Iran's drone attack on Israel. Prices plummeted from $68,000 to about $60,000 on Saturday due to tensions in the Middle East and the approach of the halving, with $1.2 billion of long positions being liquidated. Despite this sharp correction, MicroStrategy co-founder Michael Saylor expressed a positive outlook, saying, “Chaos is good for Bitcoin.”
chaos is good #bitcoin.
— Michael Saylor ⚡️ (@saylor) April 13, 2024
His remarks were shared on X after MicroStrategy lost more than $1.5 billion of its holdings in Bitcoin's weekend selloff. Still, the company maintains significant profits of more than $6 billion.
Saylor's comments sparked mixed reactions within the crypto community. While some criticized his timing, citing ongoing international conflicts, others agreed with his view of Bitcoin as a “hedge against disruption.”
Historical data shows that Bitcoin often faces initial price declines during times of geopolitical instability, but tends to recover as it is seen as a long-term haven.
For example, after the Russia-Ukraine conflict began in February 2022, the price of Bitcoin fell to around $39,000, but recovered to $44,000 within a week, according to CoinGecko data. Similarly, after the conflict between Israel and Hamas in October 2023, Bitcoin initially fell by 6%, but rose to $35,000 within a month.
Last March's banking crisis reflected this pattern, although Saylor's comments were not necessarily related to economic turmoil.
When Silicon Valley Bank faced a run on March 10, 2023, Bitcoin prices briefly fell below $20,500, but quickly recovered and rose to a nine-month high by the end of March. This recovery was further strengthened by the filing of a Spot Bitcoin ETF by BlackRock.
Despite recent war concerns, Bitcoin market sentiment remains bullish. According to Alternatives data, the Fear and Greed Index is currently at 74, down from “extreme greed” but still in “greed”, reflecting strong investor confidence. This optimism is likely fueled by the looming halving, which has historically been followed by a peak in Bitcoin prices several months after the halving.
Bitcoin regained $66,000 earlier today after Hong Kong officially approved the Spot Bitcoin and Ethereum ETF. At the time of writing, Bitcoin is trading at around $62,500, down 2.5% in the past 24 hours, according to data from CoinGecko.
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