At press time, bitcoin is trading for just under $10,400. This is about $300 higher than where it stood over the weekend, and it’s all thanks – according to one source – to recent tweets submitted by President Donald Trump regarding the U.S.’s trade war with China.
Bitcoin and the Trade War Are Interlocked
The trade conflict has been going on for some time now, and right in the middle of all the action has been bitcoin. Sometimes it goes up, sometimes it goes down. A few weeks ago, bitcoin was trading in the high $11,000 range given that many were concerned about the stock market and other significant signs that the country’s financial system wasn’t doing well. Many saw bitcoins as “digital gold;” a “safe haven” that could potentially preserve wealth in the event of economic disaster.
While nothing like that occurred, fear was running rampant throughout the space. The price inherently went up while stocks and other traditional market tools went down. Unfortunately, those fears ultimately kicked the bucket, and bitcoin began easing back down into the $10,000 and $9,000 range. While it’s moved up somewhat, there’s still plenty of room for growth.
Now, bitcoin is trading higher given that Donald Trump says he feels “regret” surrounding the trade war. He doesn’t regret initiating it; rather, he’s regretful that he didn’t start it sooner, and he wishes he had enforced larger tariffs.
The playing field is still open for both sides, and Trump’s new tariffs on approximately $300 billion new imports from China are slated to begin in September of this year. Nigel Green, the chief executive of the financial consultancy firm deVere Group, explained in an interview:
Escalating tensions between the two world’s largest economies will see investors pile in to decentralized, non-sovereign and secure currencies, such as bitcoin, to protect them from the turmoil taking place in traditional markets.
Green later commented that users can expect to see the prices of bitcoin and other cryptocurrencies spike heavily in the coming weeks.
The real fuel to the fire came from Donald Trump’s recent messages, which say that China has long taken advantage of America. He’s looking to prevent that from happening in the future, stating:
Sadly, past administrations have allowed China to get so far ahead of fair and balanced trade that it has become a great burden to the American taxpayer. I can no longer allow this to happen. In the spirit of achieving fair trade, we must balance this very unfair trading relationship.
A First Time for Everything…
Market analyst and crypto investor Alex Kruger noted the significance of bitcoin’s sudden burst, explaining:
Today was the first time that bitcoin reacted sharply in real-time to a trade war breaking headline. As far as I can recall, this is the first time that bitcoin reacts in real-time to any event outside crypto.