Cryptocurrency

Why the Bitcoin price is for the long term benefit of U.S. sanctions against China – Coin Update

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Bitcoin expected market growth, as the national security Advisor to the White house, Robert O’brien, China threatens with economic sanctions because of national security law in Hong Kong.The warning could lead to the People’s Bank of China to devalue the Yuan, what could be, according to Naeem Aslam from AvaTrade for all currencies as “catastrophic”.Bitcoin and Gold could attract in the midst of the disturbing geopolitical crisis, however, more buyers.
Bitcoin once had a nearly perfect negative correlation with the Chinese Yuan up. As the national currency fell, rose the crypto-currency later.
The different assets created in mid-2009 at the height of the trade war between the US and China a close. As reported by Bloomberg, investors may use Bitcoin as a hedge against the intentional devaluation of the Yuan by the People’s Bank of China.
The demand for the crypto-currency was so great that the people paid willingly for a reward of 300 dollars for it.
Correlation between Bitcoin and the Yuan in mid-2019 | source: Bloomberg

Now, a year later, expects Bitcoin to a similar growth in the market, because the United States and China commit to a new Form of “Cold war”.

U.S. sanctions against China

Bitcoins bullish bias had improved after the national security adviser to the White house, Robert O’brien, threatened to impose in retaliation for the proposed national security law on Hong Kong’s sanctions against China.
“It looks as if you would apply this law to the national security, basically, Hong Kong, and if you confirm that you do … this is not the right Minister Mike Pompeo likely to be able to, that Hong Kong retains a high degree of autonomy.”
And, according to O’brien to NBC:

“If that happens, there will be sanctions that will be imposed on Hong Kong and China”

Of the sanctions-affected countries have experienced in the last five years, a higher demand for Bitcoin. Technically savvy people in Venezuela, for example, use the crypto currency to protect themselves against a criminal higher Inflation hedge.
In Iran, the citizens use Bitcoin to bypass the international banking ban and as a measure to protect your savings from a case Rial ends.
Meanwhile, a 2019 from the analysis of company Gate Trade survey showed that 25 percent of Iranians earn 500 to 3,000 dollars per month with Bitcoin-related transactions.

Bitcoin in the currency war

If the US proceed with their plans to impose economic sanctions against China continue, this could lead to a devaluation of the Yuan by the PBOC. Naeem Aslam, the chief market analyst from Avatrade, sees a weaker Yuan, which exerts a ripple effect on all the currencies of the emerging countries.
The Analyst:

“It could devalue to give a currency war in which each Central Bank is trying to get their currency”

And more:

“With a renewed trade war between the US and China, the Renminbi will be substantially weaker, and the exchange rate will be around 7 Yuan per US Dollar”

The disturbing geopolitical scenario could lead to more and more small investors in Bitcoin to bring in security or Gold behaves as a hedge against currency-related inflation. The crypto-currency is already more than 120 percent above their lows of mid-March.
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About the author

Eve Manning

Eve Manning

A native Texan, Eve first started out as a Finance Analyst and later realized that her true passion was not in trading but in writing. She leverages her experience in the Finance industry to analyse and write in-depth news articles covering the Cryptocurrencies, Economy & Finance industries.

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