Nobody knows what effects the Russian war will have on the price of bitcoin (quotation BTC). But one thing is clear: Russia's uncertainty and economic blockade have provoked a radical reaction in the markets. On the one hand, global stock markets have fallen and, on the other, the purchase and price of safe-haven assets, such as gold, oil and some commodities, have risen.
Compared to gold it is worth much more
But there is an intruder among the safe-haven assets that have exploded in purchases since the beginning of the war: bitcoin. This is the largest cryptocurrency on the market, which has gotten an over-buying shock that has sent its price from USD 37.000 to over USD 40.000 since Russia started bombing Ukraine.
This signals that it is appreciating despite the fluctuations in its value during this period. And this in turn would indicate two possible scenarios: either this is simply normal trading behavior for cryptocurrency or we are faced with a possible historical fact showing that bitcoin is consolidating as a safe haven and digital gold.
So far, the cryptocurrency has had too much volatility to be considered a safe haven to safeguard the value of money. However, in thirteen years (since its inception in 2009) a bitcoin has gone from the value of a few cents to $ 40.000, and even more if we take the historical peak reached in November 2021 at $ 67.600.
In comparison, an ounce of gold today is worth only $ 2.000, a very low figure when you consider that it is an ancient commodity that has been in use for more than 21 centuries. Although its advantage is that its value has remained relatively stable over time due to its continued trade and scarcity around the world. This is something that several analysts believe could happen with even the largest cryptocurrency on the market, which is taking the first steps to become the new alternative to gold.
Bitcoin has everything to become digital gold
Key figures such as Steve Wozniak, the co-founder of Apple, and Alfred Kelly, the CEO of VISA, have labeled bitcoin as the new digital gold. This is because they have an ongoing market interest and limited capacity. There will be only 21 million bitcoins in the world by the time miners finish mining them, which satisfies gold's character of scarcity. In other words, it is a deflationary commodity.
This differs from national currencies which depreciate as banknote printing increases. Especially in times of economic crisis and government malpractice. This is why the war has encouraged the purchase of gold and other commodities such as oil and commodities such as gas and wheat, for example, as well as bitcoin.
Bitcoin is unique, transparent, immutable ...
Marion Laboure, economist and market strategist at Deutsche Bank, commented that humanity has always sought strong assets that were not controlled by governments or a power. You noted that "gold has played this role for centuries". But she warned that bitcoin could potentially become the digital gold of the 21st century.
Bitcoin is unique, transparent, immutable, efficient, programmable and scarce; a combination of features that could increase its long-term value. It is mathematically pure gold, the only digital gold.
This same idea is suggested by analyst Zoltan Pozsar of the famous Swiss financier Creddit Suisse, who warned that we are initiating a new world economic order. He argues that war and the economic crisis will cause people to seek assets that are not confiscated by the government, creating a change in the history of money that would benefit bitcoin.