Chaos Is a Crypto Catalyst

Chaos Is a Crypto Catalyst

By Luke Lango, senior analyst, InvestorPlace

With markets teetering on a knife-edge – rattled by trade wars, AI shocks, and geopolitical turmoil – only one asset has a history of turning chaos into massive gains.

In fact, the past week has demonstrated just how chaotic the markets can be… (and just how important that singular asset is).

On Monday, Trump slapped sweeping tariffs on our three largest trading partners – Canada, Mexico, and China – prompting a global trade war, quelled only by a deal at the 11th hour.

Before that, a highly efficient AI model emerged from China, rivaling those from Big Tech and undercutting them by a huge margin. The market reacted to DeepSeek-R1 with a cascade of selling that will now go down as the worst day for artificial intelligence stocks since the AI boom began.

While the market has mostly recovered from both crashes, we all know this could get worse before it gets fully better.

And we haven’t even mentioned the fragile peace in the Middle East, which could break at any moment and add volatility to oil and gas… or the recent shift in European Union energy policy in which Western Europe is trying to reduce dependency on Russian gas by accelerating renewable energy.

Absolutely… the world feels out of sorts these days… and many investors are starting to hide out in gold. 

But that’s not the best-performing asset in chaotic times. 

Believe it or not, when the world feels out of sorts like it does today, the one asset that tends to reign supreme is cryptos.

But you have to trade them correctly… because cryptos are also among the most dangerous assets during chaos.

Today, I’ll talk about why that is.

The Past Crypto Markets in Chaos

Let’s get started by thinking back to 2020-’21…

The world certainly felt out of sorts back then, too.

Remember – the pandemic was sweeping the globe, forcing businesses, schools, and just about everything else to shut down.

Joe Biden and Donald Trump faced off in one of the most intense American presidential elections ever.

There were riots and protests on the streets of major cities seemingly every week. 

And yet, Bitcoin (BTC/USD) soared.

In 2021, Bitcoin popped 40%. That same year, about 70 “altcoins” – that is, cryptos other than Bitcoin – soared more than 1,000%!

It was a blockbuster year for the crypto markets. 

How about 2016?

The world felt precarious back then, too.

Trump burst onto the political scene out of nowhere… and won the White House.

Brazil and South Korea impeached their presidents.

Turkish troops tried to overthrow President Recep Tayyip Erdoğan – and failed.

North Korea tested nuclear weapons.

And the United Kingdom voted to leave the European Union. 

Yet through all that mess, Bitcoin soared.

In 2017, BTC rose almost 1,000%!

It was a blockbuster year for the crypto markets. 

Let’s even think back to 2012. 

Back then – just like today – tensions in the Middle East were flaring. The U.S. Consulate in Libya was attacked, as well as a CIA office nearby. Israel assassinated the military leader of Hamas. A veteran American war photographer was killed in Syria.

Yet, despite those Middle East tensions, Bitcoin soared 4,500% in the following year. 

You get the point. 

Despite their rep as a “risky asset,” cryptos tend to soar in times of geopolitical chaos. 

Now, let’s talk about what we can do with that info…

The Opportunity – and Danger – Is Clear

What do we find ourselves in right now?

Geopolitical chaos.

Tensions (while paused) remain a risk in the Middle East, much like in 2012. Political tensions are flaring in America, much like in 2016. Inflation fears and the risk of an all-out trade war are running rampant, much like in 2020.

What we have today is a mix of the exact same situations that, in the past two decades, have led to massive crypto rallies. 

We don’t think this time will be different. 

If history repeats… then fortunes could be made in cryptos over the next year. 

But I’m here to warn you: Do not just buy Bitcoin and other small altcoins…

Because cryptocurrencies can fall just as hard and fast as they rise during market chaos.

That’s because, as “risk-on” assets, they move farther and faster than staid stocks do.

So while they absolutely soar as chaos winds down, they can rise and fall multiple times rapidly during that chaos, which can shake out less certain investors.

For example, in the runup to this past weekend’s tariffs, Bitcoin dropped below $100,000 on Feb. 2, for the first time since mid-January, while big altcoins dropped 20% or more.

In other words, the market moves you see in mainstream stocks are nothing compared to what’s available in crypto.

That’s why, after nearly a year of working behind the scenes, I’m holding an event I’m calling The Great American Crypto Project.

There, I’ll talk much more about my team’s quant-based trading algorithm designed to identify a predictable pattern before cryptos tend to soar tenfold, fiftyfold, even a hundredfold in 90 days or less.

And I’m planning to present three such trades this Thursday, February 6, that could soar in Trump’s first 100 days in office.

Plus, I’ll brief you on three specific new White House crypto policies that could ignite the biggest crypto supercycle we’ve ever seen.

Just go here to RSVP for my Great American Crypto Project event on Thursday at 10 a.m. Eastern.

I hope to see you there,

Luke Lango
Senior Analyst, InvestorPlace