Is Bitcoin a Safe Haven Amid Geopolitical Unrest?

Gold has consistently surged while Bitcoin has struggled during geopolitical flare-ups—such as the recent tensions between Israel and Iran. Learn more about the implications of this pattern.

Almost everyone is aware of the latest escalation in geopolitical tensions following Israel’s strike on Iran’s nuclear facilities—a fierce attack that reportedly killed at least 224 people. In response, Iran launched a missile barrage targeting Israel, with several missiles breaching the Iron Dome defense system and striking major cities, resulting in at least eight fatalities.

As a student and analyst of financial markets, I closely watch how various assets respond to events like these—whether geopolitical, economic, or monetary—because their reactions can offer valuable insight into how they are likely to behave in the future. With that in mind, today I’m taking a closer look at how Bitcoin has performed amid this recent Middle East turmoil, comparing its response to that of gold, and exploring what we can learn from the contrast.

First, it’s worth addressing a popular claim among Bitcoin enthusiasts: that Bitcoin is “digital gold.” Many go so far as to argue that it has replaced physical gold entirely, thanks to what they see as its superior, modern-day technology. I strongly disagree with that view—for many reasons, 24 of which I outlined in a detailed report I published late last year. One of the key reasons is how Bitcoin consistently behaves during times of geopolitical turmoil. Rather than rising as a safe-haven asset, it tends to fall—while gold, by contrast, reliably surges. In this piece, I’ll highlight several notable examples of that pattern and explain why it matters.

The chart below highlights the stark contrast between gold and Bitcoin’s performance following the initial reports of Israel’s attack on Iran late last week. Gold surged approximately 3.5%, while Bitcoin dropped as much as 5.5%—a striking 9% performance gap in just a matter of days. It raises an important question: what happens if this conflict escalates into a broader war involving the U.S. and other nations? Based on its track record, I believe Bitcoin—which behaves more like a speculative risk asset than a safe haven—would likely fall even further, while gold would likely rally significantly higher.

This pattern of gold outperforming Bitcoin has repeated itself during numerous other geopolitical crises—including the October 7th, 2023 attack on Israel, which ignited the current wave of Middle Eastern conflict and deeply polarized public opinion across much of the Western world: