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Bitcoin fell this weekend following an Iranian drone attack on Israel. Under the influence of tensions in the Middle East and the impending halving, the price plunged from $68,000 to around $60,000 on Saturday, with $1.2 billion in long positions liquidated. Despite this sharp correction, Michael Saylor, co-founder of MicroStrategy, expressed a positive attitude, saying: “Chaos is good for Bitcoin.”
Chaos is good for #Bitcoin.
– Michael Saylor⚡️ (@saylor) April 13, 2024
His statement was shared on X after the weekend’s Bitcoin slowdown eroded more than $1.5 billion from MicroStrategy’s holdings. The company nevertheless makes a substantial profit exceeding $6 billion.
Saylor’s comments sparked various reactions within the crypto community. Some criticized his timing due to the ongoing international conflict, while others agreed with his view of Bitcoin as a “hedge against chaos.”
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 safe haven.
For example, after the Russian-Ukrainian conflict began in February 2022, the price of Bitcoin fell to around $39,000, but rebounded to $44,000 within a week, according to CoinGecko data. Similarly, following the Israel-Hamas conflict in October 2023, Bitcoin initially fell 6%, but reached $35,000 within a month.
Last March’s banking woes also reflect this trend, although Saylor’s comment wasn’t necessarily linked to economic chaos.
When Silicon Valley Bank faced banking runs on March 10, 2023, the price of Bitcoin briefly fell below $20,500, but quickly recovered, hitting a nine-month high in late March. This rally was further strengthened by BlackRock’s filing of a spot Bitcoin ETF.
Despite recent war fears, Bitcoin market sentiment remains optimistic. According to Alternative’s data, the Fear and Greed Index currently sits at 74, indicating “greed” – down from “extreme greed” but still reflecting strong investor confidence. This optimism is likely fueled by the approaching halving, which has historically been followed by a price spike for Bitcoin several months later.
Bitcoin reclaimed $66,000 earlier today after Hong Kong officially approved Bitcoin and Ethereum spot ETFs. At the time of writing, Bitcoin is trading at around $62,500, down 2.5% over the past 24 hours, according to CoinGecko data.
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