07 Jan 2020 Josphat Kariuki
US vs. Iran Conflict Rises Cryptocurrency Prices
The global trade market seems to be shrinking as a result of the conflict between Iran and the United States. Oil prices took a u-turn from the surge over the past weekend. Gold also is retracting its position after hitting a seven-year high, balancing out the price increase.
War and military company stocks on the other hand, made a price jump. Exchange-traded funds (ETFs) like iShares U.S. Aerospace & Defense ETF (ITA) and the SPDR S&P Aerospace & Defense ETF (XAR) made 2,5% and 4% jumps, respectively. Other companies in the military sector also received a price push, with Northrop marking an 8% stock price increase, followed by Lockheed Martin and Raytheon with price increases of 4% and 2%, respectively.
The crypto sector, however, responded to the geopolitical tension between the United States and Iran, as the industry recorded an 11% increase since U.S. President Donald Trump ordered an airstrike against Iranian general and leader of Iran’s Islamic Revolutionary Guards Quasem Soleimani. The total crypto market capitalization reached over $211 billion.
Bitcoin, the leader of the pack in the crypto sector, made a nine-percent price increase since the attack on Quasem Soleimani, with 4% gained just on Tuesday alone. As of press time, the world’s number one crypto trades at $7,863.48.
The most probable reason for the increased crypto prices is due to the fact many foreign investors consider cryptocurrencies as a safe-haven for their wealth – just like traditional gold. Financial advisory company DeVere Group’s CEO Nigel Green stated that more and more investors are seeking shelter “into the decentralized, secure, and nonsovereign sector of cryptocurrencies, and Bitcoin in particular.” Green also noted that the shift towards cryptos is caused primarily due to “geopolitical turbulence.”
Sheel Kohli, CMO at the AAX crypto exchange further explained why investors are putting their funds into Bitcoin. Kohli noted that “investors feel they can rely on Bitcoin for safely holding a portion of their wealth as the crypto sector is not tied to the war conflict.”
On the other hand, some investors are using privacy-oriented cryptocurrencies, such as Dash and Monero, for actions other than keeping their fund safe. Christopher Flinos, a trader at Hayvn Capital, stated that “Cryptos like Dash and Monero actually provide investors with a quick and secure way to transfer funds from one mainstream asset into the digital world.”
Furthermore, the Arabic world is not yet accustomed to the crypto sector, so it’s hard for Gulf Arab economies to embrace cryptocurrencies as a preferred safe-haven.”, scholar Robert Mogielnicki added.
The traditional finance sector and regulatory authorities also raised a flag of concern about the crypto sector being used for money-laundering and terrorism financing. However, Arabic citizen prefer to enter the crypto sector, using Tether as a gateway, as USDT is tied to the U.S. Dollar price. Tether also received a push in trading volumes, recording $51 billion in trading volume since the January 3rd airstrike.
Other cryptocurrencies like Ethereum and Ripple also received nearly 9% push, trading in at $141.16 and $0.210561, respectively. Dash recorded a whopping 36% price increase over the past week, and Monero saw a 26.14% price increase.Bitcoin Ethereum cryptocurrency trading Cryptocurrency exchange Monero Cryptocurrency Crypto Market Tether Ripple crypto market monitoring Ethereum news Dash Coin Dash cryptocurrencies bitcoin news cryptocurrency news finances USDT