Analysts have speculated that the US-China tension is crucial in the rise of Bitcoin’s price.
With the tension between the US-China tension not looking to abate soon, the United States (US) economy is gradually succumbing to its effects.
With the known fact that the trade war stands to give Bitcoin an edge, experts have also positioned that China might look to Bitcoin as an edge to evade the US sanctions’ biting effects.
Furthermore, experts have critically looked at the prospect of the digital Yuan while noting that the US might be pushed to develop its digital Dollar.
Bitcoin enjoying benefits of US-China tension
If things eventually go this way, it would bring about a growth in the popularity of digital assets hence driving the adoption high. Some experts have noted that the only thing that can benefit the digital assets market is the declining American economy and not the development of a digital dollar.
If their comments are thought out carefully, then the US-China tension is just a sign that the US economy is gradually declining. Bitcoin recently began to enjoy a price surge on July 25 after moving around trading sideways in the months before.
Presently, the BTC price is trading around $11,000, and it is coming weeks after Trump announced the ban on TikTok amid other things, including the closing of their respective consulates.
China suffers brunt in the US-China tension
Taking a critical look at things, one can conclude that the rising tensions between the US and China may spell effects that go way beyond the increase in Bitcoin price.
Another critical effect might be the movement of the majority of miners away from China, which, according to records, boasts 65% of Bitcoin’s hash powers.
Giving its view on the continued US-China tension, BitOoda, a digital finance outfit, said that the weak relationship between both countries resulted in sanctions that have drastically reduced China’s market shares. An increase in monetary nationalism might be another adverse effect of the US-China tension. This might spell good or bad for Bitcoin depending on which side you’re on.
A word on monetary nationalism
The doctrine of monetary nationalism states that country’s share in the world’s supply of money should not be left to be determined by the same principles and the same mechanism as those which determine the relative amounts of money in its different regions or localities.
This doctrine is practiced by China and other regimes of monetary nationalism when a currency’s sphere of circulation is coextensive with the borders of the nation whose central bank issues it.