Gold and Silver Weather the Storm as Middle East Unrest Shakes Crypto Markets

 Gold and Silver Weather the Storm as Middle East Unrest Shakes Crypto Markets

Over the weekend, cryptocurrency assets saw a significant drop, with the crypto economy shedding more than 5% to fall to $2.3 trillion, while precious metals also saw declines, albeit less severe than the digital currency sector. Amidst the ongoing turmoil in the Middle East, gold fell by 1.18% in the last day; however, in contrast to bitcoin, it has appreciated against the U.S. dollar over the past week. Furthermore, recent survey data suggest that investors hold an optimistic view of gold for the coming week.

Gold Holds Steady Amid Geopolitical Tensions; Recent Survey Highlights Ongoing Bullish Sentiment

On Saturday, tensions escalated as Iran conducted a drone airstrike against Israel, wiping out over $330 billion from the value of the crypto market. Data indicate that BTC dropped 6.9% over the last week due to the weekend’s downturn. The downturn in the crypto market is largely linked to the Iran-Israel conflict, and U.S. equities are anticipated to experience some impact on Monday. Precious metals, however, experienced only minor losses in comparison to BTC and ETH.

Price of gold on Sunday, April 14, 2024

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Gold remains 0.6% higher for the week despite a 1.18% decrease in the last 24 hours. Silver has declined by more than 2% during the past day, yet weekly figures show that silver is still up by 1.36%. Over the past six months, both precious metals have climbed more than 21%, and despite bitcoin’s downturn, it still posted a 124% gain over the same period. This week’s Kitco News Weekly Gold Survey reveals that investors in Wall Street and Main Street’s precious metals remain bullish, noting that “geopolitical risks” may act as support rather than hinder gains.

The day before the attack, Frank McGhee from Alliance Financial addressed the escalating tensions between Iran and Israel with Kitco, remarking, “The best component that I can see now is that the market is finally paying attention to geopolitical, and as the threat of an Iranian attack on Israel looms, the market has finally just decided to take notice.” During the cryptocurrency downturn on Saturday, metrics further indicate that traders not only sought refuge in U.S. dollar stablecoins, but also gravitated toward gold tokens such as Tether’s XAUT and Paxos’s PAXG, which both experienced notable increases.

Specifically, PAXG soared to $2,855 per coin on Saturday, drawing considerable interest following the public announcement of the drone airstrike at 2 p.m. Eastern Time. While the substantial premium on PAXG has diminished, it maintains a $100 premium over the current gold spot prices. Meanwhile, the premium observed with XAUT was less pronounced, yet it still stands at $25 above the gold spot price as of Sunday afternoon.

What do you think about gold and silver weathering the storm amid the Middle East conflict between Iran and Israel? Share your thoughts and opinions about this subject in the comments section below.