Important takeouts:
Bitcoin has returned since 2010 after major negative-side catalysts have exceeded 64.6%, suggesting that recent escalation of tensions in the Middle East could be an opportunity for BTC purchases.
Despite trading near the all-time high, Bitcoin’s Puer multiple remains in the discount zone, indicating institutional accumulation and undervalued market conditions.
Following Israel’s airstrikes in Iran, Bitcoin (BTC) prices fell to $102,650 in Friday’s vinance. As tensions reached its peak, oil prices rose 5%, and historical data suggest that BTC’s DIP could be a purchase opportunity. Amidst rising global tensions, Bitcoin’s past performance during a geopolitical crisis offers an attractive investment case.
Bitwise Europe’s Head of Research André Dragosch highlighted this possibility in the X-Post, citing data from the top 20 geopolitical risk events since 2010. Analysts said Bitcoin averaged price increases within 50 days on average, with a median of 17.3%.
The chart shows the performance of Bitcoin’s geopolitical events on a log factor scale. The average performance (green line) remains relatively stable before the risk event, but soars after the event and peaks in the MIN-T-MAX range (shaded area) about 30-40 days later. This pattern suggests that current dips are a temporary market response, and that historical precedents could point to substantial profits in the coming weeks.
Blockstream CEO Adam Back has reinforced this trend, countering the skepticism of gold advocate Peter Schiff from 10 major events since 2020. The back chart reflects Bitwise, showing a 20% increase in Bitcoin after the US Iran escalation in January 2020, often surpassing the Gold and S&P 500.
The October 2020 survey also complements these findings. Using the Granger Causality Test on Bitcoin Price and Geopolitical Risk Index from 2010 to 2019, this study identified two-way effects, indicating that Bitcoin not only responds to geopolitical events, but also serves as a stabilizing asset during global uncertainty.
Related: Bitcoin Mirror 80% Rally Setup ahead of the 2024 Israel-Iran conflict
Puell Multithers supports Bitcoin Investment Papers
Cryptoquant’s data also suggests that Bitcoin is in the purchasing space. Puer multiples tracking daily revenue against the Miners annual average remains near the discount zone below 1.40 despite Bitcoin’s recent peak exceeding $108,000.
This rare divergence was strengthened by showing the reduced block reward, underestimation of Harving in April 2024, suggesting that the market is driven by institutional demand or tightening of supply and not miners’ sales pressure.
Historically, multimarks below 1.0 are in the accumulation stage, indicating that Bitcoin’s current gatherings are far from the peak of euphoria. Post added
“The current scenario therefore represents a window of potential opportunities. The combination of historically high prices and still conservative foundations reinforces that there is only half the upward cycle.”
Additionally, GlashNode data shows Bitcoin is currently trading at $106,200 for a week, $105,200 for a week, $98,300 for a three-month, $97,000 for a six-month, $97,000 for a week, $106,200 for a week, and $97,000 for a six-month. The BTC cost base represents the average price an investor has acquired Bitcoin over a given period. The risk of panic sales remains low as most owners are making profits, but it could change in the coming weeks.
These metrics – multiple resilient cost bases in discounted Puer – highlight a robust foundation for recovery, suggesting that the current dip could be a great opportunity for investors looking at Bitcoin’s next upward move.
Related: Bitcoin Price Bollinger Band “Failure” Risk of “Failure” End of the Uptrend at 112K
This article does not include investment advice or recommendations. All investment and trading movements include risk and readers must do their own research when making decisions.
