The war in West Asia has sent shockwaves through the global market, causing oil prices to rise sharply. This has led to increased uncertainty and volatility, with investors becoming increasingly cautious. However, despite the challenges, Bitcoin's price has held relatively steady, even outperforming traditional assets such as gold and the S&P 500.
According to eToro market analyst Josh Gilbert, the current environment is characterized by a 'headline-driven' market, where oil prices are driving sentiment. This is causing investors to de-risk their crypto holdings, leading to a sideways grind in prices. However, Gilbert believes that Bitcoin can still weather the storm and argues that institutional demand for crypto remains strong.
The Reserve Bank of Australia has already raised interest rates in response to inflationary pressures, and the US Federal Reserve may follow suit. If this happens, it could put further pressure on crypto markets. However, Gilbert notes that Bitcoin's resilience is likely due to its increasing maturity as a market, with growing institutional investment and the emergence of new products such as spot ETFs.