Key Insights:
- Israel-Iran Conflict Escalates with Airstrikes and Drone Retaliation.
- U.S. Declines Military Involvement While Pushing Bitcoin Reserve Talks.
- Bitcoin Considered Strategic Amid Geopolitical Volatility.
Israel launched a campaign of airstrikes early Friday morning local time against Iranian nuclear installations and other key facilities.
The Israel Defense Forces (IDF) claimed that the attacks were meant to destroy nuclear sites and high-ranking members of the Iranian military hierarchy. Operation Rising Lion was the start of what the Israeli leadership has presented as a multi-day military operation to eliminate what they have described as an existential threat imminent to them.
Brigadier General Effie Defrin announced that 200 Israeli fighter aircraft dropped 330 munitions on 100 targets in Iran. IDF also announced the deaths of Hossein Salami, the commander of the Islamic Revolutionary Guard Corps, and Major General Mohammad Bagheri, the Chief of Staff of the Iranian Armed Forces. The assassinations comprise one of the worst setbacks to the military command of Iran in recent decades.
Iran, in turn, sent over 100 drones in the direction of Israel. Some of the drones were due to enter Israeli airspace by midday Friday and caused a nationwide defense alert. According to Israel, all the defense systems were activated to shoot the incoming threats.
The IDF argued that the Iranian actions were part of a coherent scheme to “wipe out Israel.” Israeli Prime Minister Benjamin Netanyahu confirmed that the attacks will last until Iranian threat is neutralized.
In spite of the scale of the attacks, U. S. officials made clarifications that the United States did not have anything to do with the Israeli operation. The Secretary of state Marco Rubio made it clear that this was a unilateral move by Israel and that the priority of the Washington was the security of American personnel in the area. President Donald Trump as well confirmed that he had prior knowledge of the strike but denied military assistance.
Bitcoin Reserve Proposals Gain Traction Amid Global Uncertainty
As geopolitical tensions were boiling over, another development occurred that may have a long-term implication on financial markets. Simultaneously with the crisis in the Middle East, the discussions among the U.S. officials and policymakers revived whether to constitute Bitcoin as a strategic national reserve asset.
Trump Wants no Bitcoin Sold
Both President Donald Trump, currently pushing on scrapping debts, and Senator Cynthia Lummis have presented outlines of how Bitcoins can be incorporated into the federal reserves of the United States. Trump suggested that instead of selling the 198,000 BTC (worth around 19 billion dollars) that the U.S.
Marshals Service currently possesses, they should keep it. This represents a change to the long-established policy of selling assets seized in criminal cases.
The proposal by Senator Lummis goes further. Her proposal is that U.S. Treasury should purchase one million BTC and store it over 20 years. The financing plan suggested involves re-valuation of the U.S. gold reserves, now pegged at $42 an ounce. This is to reflect market rates and hence realizing more than $400 billion of slumbering value.
Lummis, who has recently been talking on a Bitcoin reserve plan, says that this action would make the dollar stronger and protect the U.S. against international financial shocks. State legislatures have also shown interest in the proposal. This is with Texas, Ohio and Pennsylvania mulling over identical proposals. This model is similar to the one used by countries such as El Salvador and Bhutan, which have included Bitcoin in their coffers.
It is not incidental that the military escalation coincided with the discussion of Bitcoin policy. As the world becomes more unstable, digital currencies such as Bitcoin are gaining more attention as a geopolitical and monetary hedge.
The Chair of the Federal Reserve Jerome Powell recently admitted the increasing importance of Bitcoin as a store of value, which is also consistent with the increased emphasis on the asset in sovereign finance discourse. Although critics, such as Cato Institute economist George Selgin, question the logic and fiscal soundness of the proposals, the momentum keeps growing.
As Trump speaks out his need of a nuclear deal, the implicit message is obvious. He stresses that uncertainty is the new constant. It is on this background that the political neutrality and decentralization of Bitcoin as an asset becomes strategically important.
The Israeli airstrikes on Iran followed by drone retaliation and the talks about Bitcoin reserves in the U.S. are an intersection of military and monetary risk.
Disclaimer
This article is for informational purposes only and provides no financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.
Brenda is additionally a news writer on the coin chapter. Brenda commits to producing excellent, well-optimized content to ensure consumer satisfaction. She has developed expertise in technical analysis and price forecasting of breaking blockchain news while at the coin chapter. Additionally, she enjoys engaging in stock markets and investing in cryptocurrencies.