War Impacts On Storing Assets Like Crypto, Gold and More

By | March 28, 2022


Whenever a War happens between two countries, there are consequences that the whole world needs to face. The recent conflict between Russia and Ukraine has caused the oil prices to go high, and people now might be worried about their assets like cryptocurrencies — and whether that or other assets are worth storing or not.

In addition to the Winter Olympics, what the world has been paying attention to recently may be the conflict between Russia and Ukraine.

This time, the global financial market has fallen sharply, and Bitcoin has fallen by a significant amount, falling by 9% at one point. So when we wonder about the decline of cryptocurrencies, many people are also more curious.

When the war comes, how should we survive, save our assets, and what preparations do we need to make? For example, should we keep cryptocurrencies such as Bitcoin?

1. Crypto Assets

Due to its unregulated, decentralized, and other factors, cryptocurrencies have become the investment choice of many emerging generations in recent years.

There will be a group of cryptocurrency supporters willing to exchange cryptocurrency with you in any country. At the same time, the most significant advantage of cryptocurrencies is that they are easy to save.

One of the ways to obtain cryptocurrency is through mining. The current miners with considerable income are Antminer S19j Pro, Antminer L7, Innosilicon A10 Pro, and others.

Although cryptocurrencies such as Bitcoin can ensure the value storage of users and have the characteristics of anti-inflation, cryptocurrencies need to rely heavily on the Internet to function normally.

Suppose the other party destroys basic power facilities and network facilities in a war. In that case, it may be relatively difficult to pay with cryptocurrencies, and you can store the value first.

2. Banknotes

Generally speaking, commodity transactions are mainly fiat currency and barter in a disaster. In contrast, fiat currency is mainly paper money.

In short, paper money is still very critical in times of war, considering the warring states’ existing financial blockade and possible inflation caused by over-issued currency.

Hence, the use of banknotes is less critical than barter exchange. At this time, a currency unit is only a tool for commodity value conversion. There are relatively few cases where it works.

3. Gold

Gold has been used as essential asset preservation since the beginning of human society. Many gold-based cultural relics can be unearthed in a large number of famous relics, which also proves the popularity of gold in most countries. The main reason for this is gold’s store of the value function.

Gold’s so-called store of value has a history of up to thousands of years, so it is still considered an essential means of storing value. But, of course, the shortcomings of gold are also apparent.

It is inconvenient to carry, and it is inconvenient to trade during wars. Therefore, you cannot buy gold with gold during wars unless there is a significant premium.

3. Diamonds and Gems

Diamonds are the second most valuable item in the world after gold. Although diamonds and gemstones are also a commodity attached to love that has been hyped around the world, it has to be said that the audience of diamonds and gemstones is still very high, as assets Means of storage, diamonds, and gemstones are also one of the essential options.

Of course, compared with gems, the valuation of diamonds already has its own set of complete standards. In addition, artificial diamonds have developed rapidly in recent years.

In some aspects, they may be more pure and standard than natural diamonds and even reach a problematic level for machines to distinguish. Therefore, if you want to use diamonds to store value, you must consider them carefully.

4. Collection of Cultural Relics

Cultural relics, calligraphy, and paintings are also crucial for storing value during the war. This part is a relatively alternative way of storing value. The main problems are preservation and identification.

War chaos can easily lead to improper preservation of folk cultural relics, resulting in poor quality, depreciation, and even the risk of damage.

At the same time, there are also problems of insufficient liquidity and strict fraud in the cultural relics collection market.

However, due to their unique scarcity attributes, the war will further reduce the number of cultural relics, so the ones that can survive must have a high value. Once you wait until peacetime, then the value is also invaluable.

4. Investment Products (Stocks and Bonds)

Suppose it is an investment in stocks and bonds in a war-torn country. In that case, this type of investment is hazardous because once there is a government change, this type of investment in the past will return to zero, such as the nationalization of some companies, etc.

As a result, the stocks and bonds in the hands of investors are likely to be worthless, which is also an important reason why the global stock market will fall wildly in the event of a war.

In addition, in the war between Russia and Ukraine, if you hold Saudi Arabian crude oil assets or Australian iron ore assets, your overseas assets will be safe in a short period.

Still, the premise is that you need to have an overseas independent account, then it is very likely that the bank collapsed due to the war, making this part of the assets unpayable.

Summarize

On the whole, if an individual encounters a scenario such as war, the priority is to hoard various necessities.

Many commodity transactions are required at this time, and stable coins in the form of cryptocurrencies other than US dollar banknotes and fiat currencies can be used to meet the essential material needs.

Gold, diamonds, and collections of cultural relics are suitable for future generations’ intergenerational transmission and are not suitable for immigrants to carry.

It is natural for domestic stocks and bonds, and other investment products to sell as soon as possible; unless you are optimistic about the situation of war and conflict, you can also buy at the lowest point.

Image Credit: Provided by the Author;  Royalty-Free Image; Unsplash; Thank you!

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