The conflict between the USA and Iran is driving the digital currency. Financial products based on Bitcoin are also increasingly in demand on the Stuttgart and Frankfurt stock exchanges.
Tensions in the Gulf region are fuelling Bitcoin. The oldest and most important crypto currency rose by more than five percent on Tuesday morning to around 8000 dollars, the highest level in seven weeks. In the late afternoon it was quoted at just under 7900 dollars according to the industry portal Coinmarketcap.
“The cryptoasset market has gotten off to a strong start in 2020,” wrote analysts at the industry company Amun. “The main reason was the increasing geopolitical tensions due to the escalation of the conflict between the USA and Iran.” Market observer Timo Emden of Emden Research came to a similar conclusion: “The tensions in the Gulf region are turning Bitcoin and Co. into assets in demand, at least temporarily.
Since the killing of the influential Iranian general Ghassem Soleimani by the USA, many digital currencies have noticeably increased in value. In addition to Bitcoin, these include Ethereum, XRP and Bitcoin Cash, Bitcoin’s “little brother”. According to Coinmarketcap, there are currently around 5000 crypto currencies with a market volume of around 210 billion dollars.
The analysts of Bloomberg Intelligence recently judged that the pioneer Bitcoin is increasingly becoming a kind of virtual gold, i.e. a supposed safe haven in times of crisis. The precious metal also rose on Tuesday.
Crypto certificates in demand
The cryptomarket is currently being boosted by another development: virtual systems are also increasingly in demand on traditional stock exchanges. For example, financial securities based on Bitcoin were the most popular product on the Frankfurt certificate exchange last year, as Deutsche Börse announced on Tuesday. In 2019 Bitcoin certificates with a volume of 72.18 million euros were traded. This corresponds to an increase of almost six percent compared to 2018.
The development of other asset classes looked worse: Overall, the trading volume in structured products in Frankfurt fell last year by ten percent to 12.3 billion euros.
Crypto products are not only on the rise in Frankfurt. More Bitcoin derivatives were also traded on the Stuttgart stock exchange, according to a Handelsblatt inquiry. Here, the corresponding total volume rose from 167 million euros in 2018 to 278 million euros in 2019.
Bitcoin certificates have only been available since the end of 2017, making it possible for private investors in particular to invest comparatively easily in the crypto-currency that has been in existence for a good ten years. However, the price of Bitcoin fluctuates strongly. A year ago, a Bitcoin cost just half of the current price of 7900 dollars. In August 2019, however, investors had to put 13,500 dollars on the table for one coin.
For those who do not want to speculate with certificates, but with “real” crypto currencies, the Berlin crypto bank Bitwala has been offering a comparatively beginner-friendly offer since Tuesday. In 31 European countries, customers of the digital bank can now buy the second largest virtual currency Ethereum in addition to Bitcoin. According to Bitwala, the fee is one percent.