Last night news broke that the US military carried out an air strike at Baghdad airport that killed one of Iran's top officials. Shortly afterwards Bitcoin rose in price by 5%.
Fear that retaliation for the assassination could fuel a war between Iran and the US has pushed prices of certain assets up, including oil and cryptocurrencies, suggesting investors may be bracing for the worst in the coming days.
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A revenge was requested by Iran's leader Ali Khamenei
The whole world is talking about the decision of the Trump administration to attack Iranian Major General Qassim Suleimani in an overnight air strike and how such a move could lead to war between the two countries.
General Suleimani was the leader of the Islamic Revolutionary Guards' Quds Force and one of the country's top political and military officers, causing the country's supreme leader Ayatollah Ali Khamenei to call for “violent revenge” and retaliation against the United States.
Fear that the assassination and the resulting retaliation could lead to war led US citizens to flee the neighboring country of Iraq. This has also caused oil prices to soar as tensions in the Middle East will likely increase.
Bitcoin price spikes after news
This has caused cryptocurrency prices to rise, with Bitcoin rising 5% from this week's low. While other cryptocurrencies also saw a pump, including Monero and Litecoin.
While some crypto investors may be buying the asset class, fearing that any impending war could be the last straw when it comes to the already fragile global economy, Iran's citizens may be willing to pay more to buy Bitcoin. , according to rumors circulating in the cryptosphere.
The current price of Bitcoin in Iranian rial – the native fiduciary currency – is only 305,435,985, however, prices on LocalBitcoins – a P2P market for Bitcoin – reportedly reach up to 3 times that value for just one BTC.
The country's already devastated native currency has been in a “death spiral” over the past 40 years, with inflation significantly devaluing the rial in recent years.
Iranian citizens fearing that any war or conflict between Iran and the US could further devalue the native currency could be responsible for the huge rise in the price of Bitcoin.