An errant Iranian missile killed 19 soldiers during a training exercise in the Gulf of Oman on Sunday night.
The Iranian navy accepted responsibility for the incident, issuing a statement saying, “On Sunday evening… during naval exercises performed by a number of the naval force’s vessels in the waters of Jask and Chabahar, an accident happened involving the Konarak light support ship vessel, causing the martyrdom of a number of brave members of the naval forces.”
The Bitcoin price dropped overnight, bottoming out at $8,482, less than 24 hours before its 3rd ‘halving’, which will see the amount of Bitcoin created in each new block reduced by 50%.
Although it is difficult to tie crypto price movements directly to market events, especially in this volatile climate, Bitcoin has tended to move downward following moments of tension or uncertainty along with other risky assets, such as when it dropped below $4,000 on March 12th.
Will it Last?
It is worth noting that previous halvings have proven to be bullish events, which could mute any lasting impact from this event.
That said, Bitcoin could face some bearish trends if the fallout from this incident leads to additional tension in the region.
For instance, this incident took place during a time of heightened geopolitical tensions in the Middle East, as just last month U.S. President Donald Trump instructed the U.S. Navy to shoot at Iranian boats if they harassed American ships in the region.
Additionally, the Iranian government is facing unprecedented scrutiny at home. It has not recovered from the criticism that it received in January when the Iranian Revolutionary Guards Corp (IRGC), its elite military force, shot down a Ukrainian Airlines passenger plane with two missiles, killing 176 onboard.
The country has also been severely impacted by COVID-19, which led to nationwide lockdowns and mounting criticism of the government.
Looking ahead, the Iranian government will likely look for ways to build support as it seeks to restart its economy, or at the very deflect blame on U.S. sanctions and other outside if it continues to struggle.
This will not be an easy proposition, and as the Iranian government searches for opportunities to restore its credibility, the chances for miscalculation and conflict will rise in the region.