Market intelligence platform Santiment Feed links the recent plunge in cryptocurrency market caps to the ongoing Iran-Israel conflict but predicts a rebound soon.
What Happened: Santiment highlighted that trader sentiment is swiftly shifting from Fear of Missing Out (FOMO) to Fear, Uncertainty and Doubt (FUD) due to the conflict. The CoinMarketCap Crypto Fear and Greed Index has slipped into the fear (36) zone as tensions escalate.
| Cryptocurrency | Price | 7 Day Gains +/- |
| Bitcoin BTC/USD | $60,354.56 | -6% |
| Ethereum ETH/USD | $2,348.88 | -10% |
| Solana SOL/USD | $136.90 | -10% |
| Dogecoin DOGE/USD | $0.1038 | -9% |
| Shiba Inu SHIB/USD | $0.00001603 | -7% |
Elaborating on the impact of previous geopolitical conflicts on Bitcoin’s price, Santiment cited the Israel-Palestine conflict in 2023 and the Ukraine-Russia conflict in 2022 as examples.
The crypto king dropped 5% in the first four days following the October 7 attack on Israel but recovered by 12% in the following nine days.
In 2022, it dropped 10% on the first day of the Russia-Ukraine war but surged by 27% in the six subsequent days.
Industry expert Anton Dziuba stated that Bitcoin is fine above the $60,000 level but should at least hold the $57,000 level.
Also Read: Crypto Whale Dumped $46 Million BTC As Geopolitical Tensions Rise: What Is Going On?
Why It Matters: Santiment's analysis suggests that geopolitical conflicts can have a significant impact on cryptocurrency markets. This pattern indicates that while conflicts initially trigger a drop in Bitcoin’s price, they are often followed by a significant rebound.
The market platform also highlighted the top ten trending crypto keywords on social platforms. Words like Iran, Israel, war, middle east, tensions and missiles are doing the rounds, implying that the situation has not only impacted global financial markets but also the cryptocurrency markets.
On the other hand, words like Uptober and October picked up steam on the search radar due to its association with a bullish sentiment in the cryptocurrency market. However, with the escalating geopolitical tensions the interest subsided.
What’s Next: The influence of Bitcoin as an institutional asset class is expected to be thoroughly explored at Benzinga’s upcoming Future of Digital Assets event on Nov. 19.
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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