Is Iran to 'blame' for Bitcoin's latest PnD?

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Jan 9, 2020

War (huh)! What is it good for? Well, Bitcoin, according to some.

The biggest digital asset pumped just over 6% earlier today, following the news that Iran launched missile attacks on several bases in Iraq housing US troops. It consolidated in the $8350 range for most of the aftermath, but dipped again to the $8000 support level after US President Donald Trump’s press conference in which he appeared ready to de-escalate the growing conflict in the Middle East.

Bitcoin's price action over the last 48 hours (Source: Sanbase)

Both of today’s events have been - at least to some in the cryptoverse - undeniable proof that US-Iran tensions are dictating the short-term price of Bitcoin. Various reddit threads and twitter pundits attributed the initial pump to the missile launch news:

On the other hand, the subsequent dump was credited to Trump's statement suggesting that economic sanctions - not military force - will be used against Iran going forward:

The tentative correlation between the US-Iran conflict and Bitcoin’s PA was the top story on crypto social media today, as evident by our Emerging Social Trends list which calculates the top 10 words gaining the most social volume around the cryptoverse:

Top 10 words on crypto social media on January 8th (Source: Sanbase)

According to Santiment data, there were over 1800 combined mentions of ‘Iran’ and ‘Trump’ on crypto social media in the last 24 hours alone:

Mentions of 'Iran' or 'Trump' on crypto social media, last 30 days (Source: Sanbase)

And while there’s no real argument that the two events are connected outside the curious timing, the narrative has been gaining major traction in the crypto community and beyond. Multiple crypto-specific publications including CoinTelegraph, Bitcoinist and DailyHodl covered the Iran-BTC angle today, and the story even started to garner some mainstream attention from the likes of The Independent and Business Insider:

That said, not everyone is convinced of the apparent causation. For many, Bitcoin’s recent price action is down to standard market volatility, with everything else seen as attempts to sell the narrative:

Many also found it repulsive how some seem almost excited at the prospect of US-Iran war pumping their bags:

Merits of the Iran theory aside, it’s worth noting that today’s events sparked the highest amount of social chatter around Bitcoin since the Big Kahuna bounced back to $7760 on November 30th:

Perhaps even more notable have been the recent crowd sentiment trends toward Bitcoin. Based on our custom algorithm, the Bitcoin-related sentiment has grown increasingly positive since the start of 2020, and is currently at a 6-month high on channels like Twitter:

So while the Iran-BTC correlation may very well prove to be a fluke, the bullish market sentiment to start the year appears increasingly real.

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Jan 9, 2020

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