Bitcoin Used as “Trade-War Play” with US-China? Possible Reason Why Bitcoin Hit $7K+ Range?


As per news outlet, CCN, who referenced Bloomberg’s Ed van der Walt, Bitcoin [BTC] prices may be on the rise due to the recently announced trade war between the US and China.

On Friday, May 10, President Donald Trump supposedly revealed a trade war with China, in which tariffs on Chinese exports will increase from the current 10 percent to 25 percent. Interestingly, it has been reported that during this exact event is when Bitcoin’s price skyrocketed above its supposed resistance level of $6,000.

Walt argued that the increase in tariff hike could potentially be leading smugglers to retort to the use of Bitcoin, that is, individuals who plan to bring Chinese products into the US illegally. Hence, noting that bitcoin is used as a “trade-war play.” As per his exact words:

“Tariffs create geographic price arbitrages, which encourages smuggling, […] which fuels bitcoin.”

The fact that smugglers are being deemed responsible for Bitcoin’s rise in prices during December 2018 does not seem justifiable according to CCN, especially considering the fact that many established financial firms (i.e. given as Fidelity Investments) have announced Bitcoin-related services. This alone could have contributed to Bitcoin’s

“hype”.

But then again, taking into account that both the US and China are known for holding powerful economies, a war between them can lead to dangers according to the International Monetary Fund (IMF).

Ultimately, leading investors and the general public to retort to alternative measures to remain on the safe side. This isn’t a surprise given the fact that the US is known for housing the most crypto investors, and hence helping to raise BTC prices.

CCN quoted two opinions: one from an economist from Capital Economics and another from VP of US-China Business Council, Julian Evans-Pritchard and Jacob Parker respectively.

Here’s what Evans-Prichard had to say:

“They have a 25% tariff on agricultural commodity imports from the US, they could double that potentially […] But actually, in economic terms probably, their best option would be to do nothing.”

Then we have Parker who argued that this trade war could be hitting the US more than anything, adding that:

“It will decrease the competitiveness of American companies, reduce the efficiency of their global supply chains and reverberate through the US economy […] This is a tax on the American consumer.”

Bitcoin’s price is $56,938.37 BTC/USD exchange rate today. The real-time BTC market cap of $1.07 Trillion currently ranks #1 with a chart dominance at 62.37%, daily trading volume of $20.07 Billion and live coin value change of BTC 1.86 in the last 24 hours.

Live Bitcoin (BTC) Price:

1 BTC/USD =$56,938.3707 change ~ 1.86%

Coin Market Cap

$1.07 Trillion

24 Hour Volume

$20.07 Billion

24 Hour VWAP

$56.88 K

24 Hour Change

$1,057.05

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