BitMEX founder Arthur Hayes believes that the outbreak of war in the Middle East could actually benefit the price of Bitcoin (BTC).
In a new analysis, Hayes outlines what could happen to the crypto industry if the conflict between Israel and Iran escalates.
Cryptocurrency veterans point out that Iranian Bitcoin miners account for up to 7% of the world's hashrate. However, even if Israel's attack disrupts the country's crypto mining sector, Hayes does not think it will affect the price of BTC.
“Remember when China banned Bitcoin mining in mid-2021?1, the hash rate recovered to its May 2021 high in just eight months. Relocating or other global players were able to increase their hashrate due to more favorable economic conditions.
Most importantly, Bitcoin hit a new all-time high in November 2021. The significant drop in network hash rate did not have a noticeable impact on price. Therefore, a complete annihilation of Iran at the hands of Israel or the US would destroy up to 7% of the world's hashrate, but would have no effect on Bitcoin. ”
Hayes also speculated that oil prices could rise if the conflict escalates and leads to the destruction of oil infrastructure in the Middle East. The former CEO of BitMEX believes it will also lead to a rise in the price of Bitcoin.
“Bitcoin is a storage of energy in digital form. Therefore, when energy prices rise, the value of Bitcoin increases in fiat currency terms. All miners face parallel increases in energy prices, so Bitcoin mining profitability remains the same
Securing energy could become more difficult for some large mining companies as power companies trigger force majeure clauses and cancel contracts at government orders. However, as the hashrate decreases, the mining difficulty also decreases, making it easier for new entrants to mine Bitcoin and earn profits at higher energy prices. The beauty of our Lord Satoshi's creation is on full display. ”
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