Are Chinese Tensions Pushing Cryptocurrencies Up?
This past summer has been hot for Bitcoin. Its price has gone from $3765 on the 1st of January, to $11,650, where it is trading currently. This is a 10% price increase in the past 24 hours. While Bitcoin has hit higher highs of $12,969 on the 10th of July, it has also dipped under the $10,000 resistance mark on two occasions. Bitcoin breaking the $11,000 mark and climbing towards $12,000 signals market optimism and further growth.
Bitcoin dominance is currently at 67.8% the highest rate its been this summer. The fiat rates for most alts remains generally unchanged in this bull run for now. Unlike the 2017 bull run, it seems that most altcoins are underperforming in comparison to Bitcoin.
Is Chinese Unrest and Trade Wars Fueling Bitcoin's Rise?
China has long been a major player in the world of cryptocurrencies. While the Chinese government has passed harsh regulations in the past, it is still a crypto mining powerhouse. Approximately two thirds of all crypto mining still occurs in China. While crypto trading is banned in the mainland, many still buy and sell cryptocurrencies.
The People's Bank of China recently mentioned cryptocurrencies in one of their bi-annual video conferences. It was a very brief statement referring to R&D done by the central bank but still a bit of a bullish statement.
In addition to the PBoC statement there have been several developments in China that might be fueling Bitcoin's rise. The Hong Kong protests have received a lot of attention from the media and the situation between protestors and the Chinese government might worsen. Tensions between China and Taiwan have also grown following a travel ban on Chinese citizens visiting Taiwan. On top of all that, President Trump's trade wars with China have also taken a toll.
The culmination of all these factors seem to be impacting the Chinese Yuan harshly. This might be causing Chinese investors to place their funds in Bitcoin. Should tensions intensify we could see Bitcoin at even higher rates.
Written by Jonathan Ganor
Writer & cryptocurrency aficionado