Unpopular Opinion: Bitcoin Could Still Fall Despite US-China Conflict

Bitcoin is reportedly attracting haven demand as an escalating conflict between the US and Iran spooks investors. But that does not mean the cryptocurrency is going to register record gains in the coming days.The bitcoin-to-dollar exchange rate on Monday was trading above a psychological resistance level of $7,500. As of 0300 UTC, the pair established an intraday high of $7,580, its best since December 23. The move brought its total gains up by 10.58 percent, as measured from Friday’s lowest level.Bitcoin surges from $6,854 to $7,580 in Just 4 Days | Source: TradingView.com, CoinbaseGeopolitical Narrative against BitcoinThe first of bitcoin’s spikes came after a price rally in haven markets on Friday – the day on which a US-sponsored drone attack killed Qassem Soleimani, a top Iranian military official. Investors moved into Gold, Oil, Palladium, and into any asset seen as havens in times of geopolitical tensions.The close proximity between the price rise in traditional havens and that of bitcoin led analysts to correlate the cryptocurrency’s gains with the US-Iran conflict. Billionaire investor Michael Novogratz, for instance, noted that the said geopolitical situation is “bullish” for bitcoin.The more I analyze this Iranian situation, the more bullish gold and $btc I become.— Michael Novogratz (@novogratz) January 5, 2020At the same time, others found the entire narrative flawed. Peter Schiff, CEO of Euro Pacific Capital, stated that there is no evidence of large capital flow from risk-on equity to bitcoin markets. He claimed that speculators pumped the cryptocurrency higher in anticipation that institutional investors would treat it as par with Gold.“Gold is being bought by investors as a safe haven,” explained Mr. Schiff. “Bitcoin is being bought by speculators betting that investors will buy it as a safe haven.”

This post was originally published on www.newsbtc.com