Bitcoin Price Wobbles Below $28,000 as Middle East Tensions Rise
The price of Bitcoin (BTC) dropped below $28,000 on Monday in response to escalating tensions in the Middle East. On-chain data suggests that this volatility could impact Bitcoin’s safe haven status and its price in the coming weeks.
Number of New Addresses Buying Bitcoin Drops to 4-Month Low
In a concerning trend, Bitcoin registered its lowest number of new addresses in four months on October 8. This decline in new users adopting Bitcoin may be linked to recent events in the Middle East, as investors turn to other safe haven assets amidst economic uncertainty.
The decrease in new addresses is a bearish sign for the cryptocurrency network as it could struggle to attract fresh demand.
Crypto-Native Investors are Doubling Down on Bitcoin
While non-crypto native investors may be turning away from Bitcoin, crypto-native investors are increasingly leaning into BTC. Bitcoin’s market share within the crypto sector has reached a 4-month peak, indicating growing confidence in Bitcoin compared to other cryptocurrencies.
BTC Price Prediction: The $25,000 Support Could Strengthen
Based on on-chain data and investor behavior, it is likely that crypto-native investors will reduce their altcoin exposure and demand more BTC in the coming weeks. This could drive up the price of Bitcoin and strengthen its critical support level at $25,000, especially if the Middle East crisis continues to create bearish sentiment across risk-on markets.
However, if bearish sentiment grows further, a cluster of addresses holding BTC at a minimum price of $26,600 may prevent the price from dropping towards $25,000.
Hot Take: Bitcoin’s Safe Haven Status Tested Amidst Middle East Tensions
The escalating tensions in the Middle East have brought both challenges and opportunities for Bitcoin. While non-crypto native investors may be seeking refuge in other safe haven assets, crypto-native investors are doubling down on BTC. The decline in new addresses buying Bitcoin is a cause for concern, but if the trend reverses and demand for BTC increases, it could push the price towards $30,000. However, the market’s response to the Middle East crisis will ultimately determine Bitcoin’s safe haven status in the weeks ahead.
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