Escalating tensions between the U.S. and Iran are likely to drive the price of Bitcoin higher, affirms the CEO of one of the world鈥檚 largest independent financial services and advisory organisations.
The comments from Nigel Green, the chief executive and founder of deVere Group, come as Tehran threatens 鈥渞evenge鈥� on the U.S. over the killing of Qassem Soleimani, the commander of Iran鈥檚 elite Quds Force, who was in charge of the country鈥檚 regional security strategy.
It remains uncertain how, when, or if Iran will respond, but any retaliation is unlikely until after the end of three days of mourning.
Mr Green notes: 鈥淏itcoin, the world鈥檚 largest cryptocurrency by market capitalisation, jumped 5 per cent as news of the strikes broke around the world on Friday. Simultaneously, the price of gold 鈥� known as the ultimate safe-haven asset – also moved higher.
鈥淲e鈥檝e seen Bitcoin price surges before during times of heightened geopolitical tensions. For instance, in August it jumped as global stocks were rocked by the devaluation of China鈥檚 yuan during the trade war with the U.S.
鈥淭his latest Bitcoin price increase underscores a mounting consensus that Bitcoin is becoming a flight-to-safety asset.
鈥淏itcoin is living up to its reputation as 鈥榙igital gold鈥�. Bitcoin – which shares gold鈥檚 characteristics of being a store of value and scarcity and of being perceived as being resistant to inflation 鈥� could potentially dethrone gold in the future as the world becomes increasingly digitalised.鈥�
He continues: 鈥淲ith an escalation in geopolitical turbulence, which typically unsettles traditional markets, it can be expected that a growing number of investors will decide to increase their exposure to decentralised, non-sovereign, secure currencies, such as Bitcoin, to help protect them from the turmoil.
鈥淭he serious concerns created by geopolitical issues, such as the U.S.- Iran issue will likely prompt an increasing number of institutional and retail investors to diversify their portfolios and hedge against those risks by investing in crypto assets.
鈥淭his will push the price of Bitcoin higher. In turn, due to the market influence of Bitcoin, other major digital currencies will receive a price boost.鈥�
The deVere CEO concludes: 鈥淏itcoin was one of the best-performing assets of 2019 and we can expect to see its investment appeal further strengthen as it becomes known as a safe-haven asset during periods of heightened geopolitical tensions.鈥�
