The U.S-Iran war is continuing to escalate day by day, with a recent fresh threat by U.S. President Donald Trump. Seeing this, even Polymarket odds on the U.S-Iran ceasefire are high on year-end bets.
Iran opens doors to crypto amidst turmoil
Amidst these escalating tensions, Polymarket has reported that Iran is taking payments in crypto as a toll from ships that are passing via the Strait of Hormuz.
This shows how crypto is acting as a hedge against turmoil and inflation. In fact, when the war had initiated, it was only the crypto market that was standing strong, whereas gold, silver, S&P 500 stocks, and the entire traditional assets market had weakened.
This comes as Bitcoin [$BTC] was trading at $69,753.50 after a hike of 4.06% in the past 24 hours.
Bitcoin against Gold and the U.S. Dollar
However, if we compare Bitcoin against Gold, a completely different picture is being painted. The BTCXAU chart shows that Bitcoin has consistently underperformed gold for months. In short, Bitcoin is attempting a comeback phase, but is unable to do so.
The Bitcoin Gold ratio further confirms this sentiment, showing that we are currently in a cooling phase after a major cycle.
Additionally, if we compare Bitcoin against the U.S. dollar, then the BTCUSD chart shows that Bitcoin is not falling aggressively, but also not breaking out.
All this combined shows that though Bitcoin and crypto are being used in times of war and unceratinity its relative strength is still weak.
In fact, we look at the top assets by market cap, Gold still ranks at the top, whereas Bitcoin is still struggling at the 12th rank.
Hope remains
However, with the Bitcoin Dominance standing at 59.02%, there’s hope that Bitcoin might recover, but for that, things need to calm down globally.
Yet, with big names like Michael Syalor’s still showing confidence in Bitcoin and noting,
Bitcoin has won. Global consensus is that $BTC is digital capital. The four-year cycle is dead.
There is hope that things might come back to normal soon.
At the back of these developments, the current condition of the crypto market had already been predicted by Coinbase’s global head of investment research, David Duong, who had summed it up well when he said,
We think markets will continue to price a modest geopolitical risk premium into crypto until there is a clearer direction on when the conflict could end.
Final Summary
- Iran’s acceptance of crypto payments shows how crypto is acting as a hedge in times of war.
- Bitcoin is strong but not strong enough to beat gold and the U.S. Dollar, hinting that it’s currently in the stabilization phase and not complete recovery.
