By Will Bartlett
Late in the night January 2nd, President Donald Trump announced that the U.S. had killed Iranian General Qusem Soleimani. The markets are reeling right now in an effort to adjust to this massive shift in global relations, as well as what it means going forward.
After going through a pretty rough December, the price of Bitcoin has reversed its downtrend and spiking through the $7,200 and $7,300 price levels. A similar effect has occurred with the price of oil, which has already jumped 3% and may jump more as the markets wake up and process this massive news.
This seems to come at a fitting time, as the beginning of each year tends to see lots of price predictions by analysts and thought leaders. Antoni Trenchev, the CEO of Bitcoin lending platform Nexo.io, recently told Bloomberg that he thought Bitcoin hitting $50K was completely within the realm of possibility. This is just one of many predictions, but with the price popping, we’ll be sure to see many more.
Multi-Perspective Reactions to the News
As the leader of the Iranian Revolutionary Guards’ elite Quds Force, Soleimani had a lot of power in Iran and was thought to be part of the driving force behind the growing tensions between Iran and the U.S.
President Bush deemed the Quds Force to be a terrorist organization during his time in power, and numerous other countries have designated them as such for their activities in the Middle East and elsewhere.
Scrolling through Twitter, you would think we had just entered World War 3. People are comparing this to the assassination of Osama Bin Laden in both favorable and unfavorable ways, and others are calling it an unsanctioned hit on a state leader.
Implications For Long-Term Price
The real question is whether in the long-term this means there will be more or less volatility in the world. Was a major danger to the world just snuffed out? Or are we slowly escalating towards nuclear war? No one can say for sure, but the jump in the price of Bitcoin shows that it still acts as a bet on volatility, as well as a contra indicator on the safety of traditional markets.
A bigger lesson here is that while many are freaking out about minor price level shifts, true investors in Bitcoin should be looking at the major global conditions that will enable (or limit) the need for Bitcoin. Until this strike on Soleimani, we were distracted by the small things, and now that we can see the bigger picture shifts in the world again, it’s hard to go back.