TEHRAN, IRAN - (ARCHIVE): A file photo dated September 18, 2016 shows Iranian Revolutionary Guards' ... [+] Quds Force commander Qasem Soleimani during Iranian Supreme Leader Ayatollah Ali Khamenei's meeting with Revolutionary Guards, in Tehran, Iran. The U.S. confirmed Thursday that it carried out a strike that killed Iranian Revolutionary Guards' Quds Force commander Qasem Soleimani in the Iraqi capital Baghdad. The strike near Baghdad International Airport killed Soleimani, one of the most powerful commanders of Iran's Revolutionary Guards, and Abu Mahdi al-Muhandis, vice president of the Hashd al-Shaabi group, or Popular Mobilization Units (PMU), local media reported. (Photo by Pool / Iranian Supreme Leader Press Office /Anadolu Agency via Getty Images)
The bitcoin price got a shot in the arm as news came out last night that theU.S. assassinated Qassem Soleimani, head of the feared and formidable Iranian Revolutionary Guard Corps (IRGC).
As of this writing, the bitcoin price is up 4.74%, approaching $7,400. It is tempting to take this observation and assume that bitcoin will continue to climb as tensions between the two countries continue to ratchet upwards.
All of this feeds the narrative that bitcoin is a safe haven asset.
This may be true, and the price of bitcoin may continue to rise. However, the expected fallout will serve as a defining test of Bitcoins presumptive role as currency of last resort or the final port in the storm.
Soleimani was the Tip of the Iranian Spear
It is hard to overstate the impact of Soleimanis assassination. While few outside of Iran will mourn his passing, there is no denying the level of power and influence that he held in Iran and around the region as a whole.
Aveteran of the devastating decade-long Iran-Iraq War in the 1980s, one which most people outside of the region have likely never heard of, Soleimani grew to become a glorified and almost mythical figure within Iran.
By leading the IRGC, he was a central player in virtually every major Iranian action in the region, including defense of the Assad Regime in Syria, securing Iranian influence in Iraq (lest the two countries ever go to war again), or supplying and supporting Hamas and Hezbollah against Israel. Some of his lesser-known activities included backing the Houthi rebels in Yemen and other groups across Afghanistan and Pakistan.
Taking out Soleimani was analogous to the U.S. losing a Secretary of Defense or National Security Advisor.
Map Strait of Hormuz and Persian gulf countries
A Stick of Dynamite into a Tinderbox
With this context, it is unsurprising thatJoe Biden likened the Soleimani assassination to tossing a stick of dynamite into a tinderbox. After all, while the world is surely better without Soleimani, nobody really knows what will happen next. All we do know is that the Iranian Supreme Leader Ayatollah Khameneivowed to take tough revenge against the U.S.
The anticipated response in and of itself should be enough to rattle markets and drive investors toward safe havens. Iranian-backed forces reach as far west as Turkey, south as Yemen, and east as Pakistan. If we take into account cyber or terrorist attacks, the entire world comes into play.
Further complicating the issue is the fact that this drama is playing out during a period of already heightened tensions in the region. U.S-Iranian relations were already poor following President Trumps withdrawal from the 2015 Iranian Nuclear Deal and application of his maximum pressure campaign against the country.
Arab Spring-esque protestshave also broken out across the region in countries such as Lebanon, Iraq, Algeria, and even Iran against causes such as income inequality or political freedom. In fact,Iraqi Prime Minister Adel Abdul MahdiandLebanese Prime Minister Saad Haririboth resigned in recent months in response to their inability to calm the protests.
Plus, there is currently aproxy war playing out in Libyapitting Turkey and the United Nations against Egypt, the United Arab Emirates, and Russia, among others.
It is hard to think of a worse time in the region for someone to light a match.
What Comes Next
Iran is unlikely to provoke all-out war against the U.S., as Khamenei and the rest of the leadership in Tehran are well aware that the fighting will largely take place in their home country (Iran does not have conventional military means of reaching the U.S.).
More likely, they are going to leverage their proxies across the region to attack U.S. allies and soft targets as they seek to exact revenge. For instance, they could try a repeat of theirattack on Saudi oil infrastructure in September 2019or disrupt the transit of oil through theStrait of Hormuz(which accounts for 20%) of the global supply.
The U.S. is on heightened alert,is deploying thousands of troops back into the region, and the State Department asked all Americans toleave Iraq immediately.
Map of the Middle East with Saudi Arabia in focus with bullets draped across
Trial By Fire
If there ever was a time for bitcoin and crypto to prove itself, this is it.
Safe havens like bitcoin, gold, and U.S. treasuries are up, while emerging market currencies have seen their biggest fall since September 2019.
These broad trends will likely continue if tensions escalate and people will seek alternatives to preserve their wealth.
However, the story is not this simple.
For the bitcoin price to continue to climb in the face of this instability, it needs to prove its resiliency and relevancy in local market conditions. Put another way, it must demonstrate utility. This means that there need to be on-ramps to the network, consistent Internet access or dense mesh networks, and users must have ways to simultaneously maintain privacy (perhaps from governments), but still find counterparties for commerce. Leigh Cuen fromCoinDeskwrote an excellent piece detailing some of these challenges in emerging markets around the world.
Now, this may be too much to ask of bitcoin right now, as it remains in its infancy, but at the same time it is hard to imagine a better proving ground for crypto.
See more here:
- Bitcoin Price Climbs to $9,500 After Third Higher High in One Week - Cointelegraph - January 30th, 2020
- Bitcoin Aint What It Used To Be, Pioneer Investor Says - Cointelegraph - January 30th, 2020
- Why Tomorrows Monthly Close In Bitcoin Could Be Its Most Critical Yet - newsBTC - January 30th, 2020
- This is the right amount of bitcoin to keep in an investment portfolio - CNBC - January 30th, 2020
- Still Too Early To Declare Longer-Term Bitcoin Trend Change - Forbes - January 30th, 2020
- Bitcoin Rallies to Near $9150 as Stocks Drop Over Coronavirus Fears - Coindesk - January 30th, 2020
- Bitcoin Eyes Best January Close in 7 Years After 30% Price Increase - Coindesk - January 30th, 2020
- Do or Die For Bitcoin Bears: Its The Most Critical Period For BTC - newsBTC - January 30th, 2020
- Bitcoin Breaks 7-Month Downtrend But Must Clear These Hurdles to $10K - Cointelegraph - January 30th, 2020
- Theres Something Very Strange Going On With Bitcoin Exchange LocalBitcoins - Forbes - January 30th, 2020
- Bitcoin Price Indicator That Called 2019 Bull Run Flashes Green Again - Cointelegraph - January 30th, 2020
- Different Type of Shakeout Trader Says Bitcoin Unlikely to Hit $6K - Cointelegraph - January 30th, 2020
- 3 Reasons Why Bitcoin Price Broke Above $9K Today - Bitcoinist - January 30th, 2020
- Yang in the Oval Office Is Bitcoins Only Chance of Reaching Critical Mass - CCN.com - January 30th, 2020
- This Bitcoin Competitor Pumped 272% And a Self-Proclaimed Inventor of BTC Says He Knows Why - The Daily Hodl - January 30th, 2020
- No Virus Woes for Bitcoin as It Climbs to Highest Since November - Bloomberg - January 30th, 2020
- Bitcoin Risk-Return a Different Beast Compared to Amazon: Analyst - Cointelegraph - January 30th, 2020
- A Massive 500 Bitcoin Sell Order Hits Binance For First Time in a While, Heres What It Means - newsBTC - January 30th, 2020
- Bitcoins 15% Weekly Gain Could Send Ethereum Flying: Heres Why - newsBTC - January 30th, 2020
- Nothing Special Bitcoin Slumps 6% on Coronavirus, Chinese New Year - Cointelegraph - January 30th, 2020
- BitMEX Open Interest Hitting $1B Could Be Bullish for Bitcoin This Time - newsBTC - January 30th, 2020
- Bitcoin, ETH, XRP, And LTC Rally Fades: What's Next? - Forbes - January 30th, 2020
- Elon Musk Reveals His True Opinion on Bitcoin and Crypto - Cointelegraph - January 30th, 2020
- Crypto Price Analysis & Overview January 30th: Bitcoin, Ethereum, Ripple, Monero, and IOTA. - CryptoPotato - January 30th, 2020
- The Invisible Global Currency Thats 24 Times Bigger Than Bitcoin - Forbes - January 30th, 2020
- Is Bitcoin in 2020 Really Like the Early Internet? - CoinDesk - January 13th, 2020
- Analyst Expects Altcoins to Suffer With Launch of Bitcoin Options: Heres Why - newsBTC - January 13th, 2020
- Dash Surges by Over 16% as Bitcoin Price Hovers at $8,100 - Cointelegraph - January 13th, 2020
- 2019 Bitcoin Transaction Volume Moved Away From US in First Since 2013 - Cointelegraph - January 13th, 2020
- Bitcoin Price Will Be Golden in 2020 Thanks to Limited Supply, Increasing Use: Bloomberg Report - CoinDesk - January 13th, 2020
- Bitcoin Trading Volumes More than Doubled in a Week Says Report - Cointelegraph - January 13th, 2020
- Bitcoin Rockets Over $8,000 As Ripples XRP, Ethereum, Bitcoin Cash, And Litecoin Suddenly Soar [Updated] - Forbes - January 13th, 2020
- Bitfinex Premium Goes Negative; Last Time it Did, Bitcoin Fell 30% in 3 Months - newsBTC - January 13th, 2020
- Bitcoin Price Analysis: BTC/USD struggles to sustain the $8,100 level - FXStreet - January 13th, 2020
- Analyst: Bitcoin to Target $9,500 Due to A Few Key Factors - Ethereum World News - January 13th, 2020
- Bitcoin Equivalent of $4.7 Trillion Added to US Debt is $260k per BTC - Bitcoinist - January 13th, 2020
- Bitcoin Price Primed For Fresh Rally And Only 1 Thing Is Holding It Back - newsBTC - January 13th, 2020
- 60% of Bitcoins havent moved for more than a year - Yahoo Finance - January 13th, 2020
- Libra Association Exec: World Needs Us Because Bitcoin Is 'Not a Means of Payment' - CoinDesk - January 13th, 2020
- Ethereum could be undervalued compared to Bitcoin: analyst - AMBCrypto - January 13th, 2020
- New Bitcoin Addresses Averaged At 124 Million Since 2017: Data - Bitcoinist - January 13th, 2020
- US and European Regulators Say Crypto a Priority This Year - Bitcoin News - January 13th, 2020
- Bitcoin Could Take Centre Stage at the 2020 NBA All Star Game, With Your Help - newsBTC - January 13th, 2020
- Bitcoin And Everything It Has Done For The World So Far - CryptoPotato - January 13th, 2020
- What good is Bitcoin if the Internet fails? - Decrypt - January 13th, 2020
- Forget gold and Bitcoin! I'd invest regularly in FTSE 100 shares in an ISA to make a million - Yahoo Finance UK - January 13th, 2020
- Independent Report Declares News.Bitcoin.com the Top Crypto News Site - Bitcoin News - January 13th, 2020
- Why Proof of Reserves Is Important to Bitcoin - Bitcoin Magazine - January 13th, 2020
- Bitcoins transaction fee 426x more than Litecoin in 2019 - AMBCrypto - January 13th, 2020
- Bitcoin Price To Rise Above $20,000 In 2020, Says Bitpays Singh - Forbes - January 10th, 2020
- Why The Bitcoin Price Could Hit $50,000 In 2020 - Forbes - January 10th, 2020
- No, Bitcoin Isnt Going For Anywhere Near $24,000 In IranHeres Why - Forbes - January 10th, 2020
- Bitcoin Is In Steep Downtrend, But This Variable Can Trigger A New Rally - newsBTC - January 10th, 2020
- Bitcoin Just Got Rejected at $8,400, And It Means a Big Fall Ahead - newsBTC - January 10th, 2020
- Ransomwares Year-End Thank You Note To Bitcoin - Law360 - January 10th, 2020
- Why Proof of Reserves Is Important to Bitcoin - Nasdaq - January 10th, 2020
- Bitcoin Accepted: This Rapper Welcomes BTC Payments and HODLs - newsBTC - January 10th, 2020
- Bitcoin Bull Run: 3 Reasons Why BTC Will Continue to Surge - Bitcoinist - January 10th, 2020
- Bitcoin Flashes Signs of Starting a Massive Bull Run, But One Key Hurdle Remains - newsBTC - January 10th, 2020
- Can digital gold Bitcoin ever be mined in India? - ETCIO.com - January 10th, 2020
- Bitcoin Starts Corrective Decrease But Bulls Not Out Of Woods Yet - newsBTC - January 10th, 2020
- Bitcoin (BTC) and Federal Reserve Have One Thing in Common, According to CNBC's Guy Adami - U.Today - January 10th, 2020
- The Recipe that Causes Bitcoin to Rise: Economic and Geopolitical Uncertainty - newsBTC - January 10th, 2020
- Bitcoin (BTC) Compared to Tesla (TSLA) by Prominent Investor. Elon Musk Won't Like It - U.Today - January 10th, 2020
- Heres What Must Happen for $9K Bitcoin Price in the Coming Months - Cointelegraph - January 10th, 2020
- These Factors Signal that Bitcoin is Just Taking a Breather Before Another Rally - Ethereum World News - January 10th, 2020
- Why Analysts Think Bitcoins Surge to $7,450 is Just the Beginning - newsBTC - January 10th, 2020
- New crisis in the Middle East: Good for bitcoin, bad for the world - Decrypt - January 10th, 2020
- How Dropgangs and Dead Drops Are Transforming Darknet Practices - Bitcoin News - January 10th, 2020
- This Company Sets Out to Prove Crypto Mining Has a Place in Your Home - Bitcoin News - January 10th, 2020
- Bitcoin price | index, chart and news | WorldCoinIndex - January 5th, 2020
- Bitcoin Price Today Live Bitcoin Value - Charts & Market ... - January 5th, 2020
- Bitcoin Price Live, Bitcoin Chart , BTC Value Today, BTC ... - January 5th, 2020
- 2020 predictions for bitcoin, Libra, and the digital yuan - Quartz - January 5th, 2020
- 2010s In Bitcoin: The Year 2019 - Forbes - January 5th, 2020
- Bitcoin is on the Cusp of a Major Price Movement - Crypto Briefing - January 5th, 2020
- Happy Birthday Bitcoin! Here's a Look at Bitcoin's 11th Year by the Numbers - Bitcoin Magazine - January 5th, 2020
- Bitcoin Price Could Rally to $9K Before a Massive Collapse, Heres Why - Cointelegraph - January 5th, 2020
- Why 2020 will be the best year yet for Bitcoins Lightning Network - Decrypt - January 5th, 2020
- Bitcoin Just Reversed And Its Likely Heading $7,400 - newsBTC - January 5th, 2020