Trade negotiations China and America Influence the Bitcoin Rate

Trade negotiations China and America Influence the Bitcoin Rate

Bitcoin is an indicator of hidden geopolitical tensions. This is what Peter Tchir, former Deutsche Bank executive director, writes in an article on Forbes on Tuesday 30 July.

Bitcoin responds to trade negotiations between China and America

In the article, Tchir speculates about the influence of trade negotiations between China and America on the price of bitcoin. He noticed one thing in particular. The price of bitcoin rose in May before it became known that these trade negotiations became known.

Tchir also notices that the price of bitcoin responds to the news. According to Tchir, the price of bitcoin decreases with positive reporting around China and America. And vice versa, the price rises when there is negative news about trade negotiations.

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Trade negotiations between China and America have resumed since Tuesday 30 July. And that causes Donald Trump to tweet about China again. As an example, Tchir gives a tweet from Trump from last Tuesday.

In it, Trump lashes out at unemployment in China. He states that China has lost no less than five million jobs as a result of the “Trump rates”. As a result of his “America First” policy, he has considerably increased the import tariffs for products from China. And that’s good for America, says Trump.

China has lost 5 million jobs and two million manufacturing jobs due to the Trump Tariffs. Trumps got China back on its heels, and the United States is doing great. @AndyPuzder @MariaBartiromo

– Donald J. Trump (@realDonaldTrump) July 30, 2019

That did not stop there, because Trump came with more muscle language that same day. Trump writes that China should not wait too long to make a deal: “If I win the upcoming elections, the agreement we are negotiating now will be much stricter than what we are talking about.”

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But price bitcoin reacts less to news than shares

The rate of bitcoin has risen a bit after this snare to China. Yet bitcoin responds less to the news than shares, according to Tchir. He therefore wonders:

“Does the Chinese elite know that the headlines are more negative than reality? It is not yet clear enough, but I think the price of bitcoin now suggests that there is no alarm from China. And that is positive. “

Tchir concludes his argument by admitting that the price of bitcoin depends on many more factors. Yet he believes that the geopolitical situation should certainly not be forgotten. News from major powers such as America and China certainly have an impact on the price of bitcoin.

More difficult to get bitcoin in China

Tchir forgets to mention that it is more difficult to get bitcoin in China. Since September 2017 it is forbidden to trade in bitcoin with the Chinese yuan. In addition, foreign cryptocurrency exhanges and ICOs are prohibited in China. All this makes it a lot harder to buy bitcoin in China.


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