If you remember, on February 24th of 2022 Russia invaded Ukraine. I remember waiting in line to send a mobile money transfer to a friend and the guy in front of me was already on his phone asking what the current rate of bitcoin was. Bitcoin had already fallen so badly since the news broke and the crypto investors that were friends of mine were saying the market was done and posting panic messages in our group chats. But by close to the end of March, bitcoin had recovered almost 20%.
If you think about this for a second, it shouldn't be surprising at all that there are positive signs coming from such turmoil. When countries go to war, they freeze the assets of the warring factions’ citizens, they sanction the banks of the warring factions’ countries and they basically disconnect the financial systems of all countries. So citizens of both countries during times of war are looking for new ways to access their funds in order to continue living their daily lives.
This is also true across both countries involved in a conflict. Bitcoin and most other cryptocurrencies have no concept of borders or flags. But instead it allows for any person to send and receive value anywhere in the world.
The war in Ukraine shows how decentralized currencies have a good value proposition. The Ukrainian government received hundreds of thousands of bitcoin and other cryptocurrencies as donations within days of Russia’s invasion. Russian citizens that were suddenly cut off from the global economy are searching for ways to protect their assets.
Not only will the need for bitcoin by citizens on both sides of the war continue to grow, but the current crisis is evidence of the role that bitcoin can and has played in these types of extreme financial situations.
Please know that this is not about justifying war, war is absolutely horrible, the one going on between America, Iran and Israel, I wish it never happened. People are dying, families and loved ones are getting displaced. There is a serious human cost to the conflict and that needs to be stated clearly.
I'm only saying that the investment asset class of bitcoin has shown time and again that crises do not destroy bitcoin, in fact it is during a crisis that bitcoin demonstrates why it will endure.