The Russian-Ukraine Crisis

The invasion of Ukraine by Russia on Feb. 24, 2022, led to a drop in the BTC price, which was around $39,000, down from approximately $44,500 a week earlier. The decline in BTC price was due to the risk-averse behavior of investors, who were uncertain about the future.

By March 1, 2022, the BTC price had recovered almost entirely, reaching around $44,000. After a period of high volatility, BTC price increased towards $48,000 by the end of March 2022, only to steadily decrease throughout the year, starting 2023 at approximately $16,600.

Israel-Palestine Conflict

On Oct. 7, 2023, Hamas attacked Israel when BTC price was around $28,000. In contrast to the Russian invasion of Ukraine, BTC price fell by less than 6% to roughly $26,500 over the following five days.

By Oct. 25, 2023, BTC price had reached $35,000 but fell by almost 5% to $33,500 by Oct. 27, 2023, when Israel invaded Gaza. Interestingly, the BTC price was less volatile than in 2022, breaking $40,000 by early December 2023 and reaching above $73,000 for the first time on March 12, 2024.

What to Anticipate

Following Iran's retaliatory attack on Israel, BTC price dropped from highs of $67,000 to current lows of $62,000 in just two hours. As geopolitical tensions rise, market risk assets are likely to continue to be sold off, with liquidity seeking safer havens as a store of value.

However, gold, traditionally considered a safer store of value, has seen a sharp decline in price, losing around $100 per ounce in the past five hours. This downturn could indicate a broader sell-off as investors move away from multiple asset classes or recoup losses.

The timing of this geopolitical event is unfortunate, as it coincides with the Bitcoin 2024 halving event, where many miners are preparing for their earnings to be cut in half. This situation could lead to a perfect storm for a cryptocurrency crash.

With the Bitcoin 2024 halving event just a week away, the timing of this geopolitical event could not be worse, potentially leading to a cryptocurrency crash.