In the summer of 2019, the 10-year minus three-month yield curve inverted for the first time in 13 years. During the upside down period, the price of bitcoin hit an all-time high for the year. The last time it happened was in 2006, followed by the global economic crisis of 2008.
On January 3, 2020, U.S. President Donald Trump ordered the killing of Iranian General Soleimani by a drone. On January 8, the Iranian government retaliated by firing missiles at two U.S. military bases in Iraq near Baghdad.
Throughout the conflict between the United States and Iran, the price of bitcoin has soared 21 percent, from just under $7,000 to nearly $8,500.
The prospect of a global economic crisis and the threat of escalating international conflicts raises an important question: Is Bitcoin a safe haven asset?
To investigate this claim, we asked world-renowned economist Campbell Harvey, best known for his theory that the yield curve is inverted as an accurate signal of an impending recession. Harvey is now J. Paul Sticht Professor of International Business at Duke University, where he has been teaching the blockchain and cryptocurrency course for seven years. In the interview, he discussed "whether Bitcoin is a safe haven" in the context of war and economic recession. He also detailed a vision of a future in which digital currencies could undermine the global hegemony of the dollar.