Bitcoin Stays Put Amid Middle East Tensions and Surging Oil Prices
Bitcoin remained steady at around $64,700 on Friday, despite a week of deteriorating macroeconomic variables that typically would have sent it plummeting. The CoinDesk 20 index slipped just 0.2% over the same period.
The usual suspects that trigger price movements were present: oil prices surged above $83 per barrel after an attack on Saudi Arabia by Yemen's Iran-linked Houthis, which normally would have had a significant impact on risk assets. However, this time around, Bitcoin didn't budge.
Experts say the reason for Bitcoin's stability lies in the bond market. The 10-year Treasury note remains at 4.67%, a threshold that Fidelity's Director of Global Macro Jurrien Timmer warned would be a bad sign for the economy. With yields at these levels, financial conditions are tightening, and inflation pressure from oil is mounting.
Gold, on the other hand, gained 1.5% to reach $4,300 per ounce as capital rotated into safe-haven assets. This raises questions about the validity of the 'digital gold' thesis for Bitcoin investors.