Bitcoin is wont to thrive during times of economic turmoil, and President Donald Trump is probably the best thing that could happen to the crypto king. In a recent tweet, the POTUS accused Europe and China of currency manipulations, claiming that Bitcoin should follow suit.
China and Europe playing big currency manipulation game and pumping money into their system in order to compete with USA. We should MATCH, or continue being the dummies who sit back and politely watch as other countries continue to play their games - as they have for many years!— Donald J. Trump (@realDonaldTrump) July 3, 2019
Buy Bitcoin— Pomp 🌪 (@APompliano) July 3, 2019
Bitcoin’s hedging power
While many deny the hedge asset narrative, there is an inextricable link between the macroeconomic situation and the Bitcoin price.
The US imposing additional tariffs on China’s goods was arguably one of the major catalysts behind Bitcoin’s price growth. That explains why there was an inverse correlation between the BTC price and the Chinese Yuan.
On the other hand, Bitcoin’s drop below the psychologically important $10,000 mark came on the heels of the Osaka Summit, where the two biggest economies agreed to a trade war truce.
The ceasefire allowed the US stock market to reach new highs while gold and Bitcoin took a hit. As of now, the Dow and the S&P 500 continue to flirt with new highs.
The US Dollar slides
Trump’s tweet instantly painted the US Dollar Index red, CNBC reports.
Notably, the Trump administration didn’t put China on the list of currency manipulators two months ago (not a single country ended up on that list). However, prior to that, China faced scathing criticism because of its unfair trade practices.
These manipulations talks play right into the hands of the crypto community.
We can't trust governments to regulate currency. Buy bitcoin.— WhiteRabbit (@WhiteRabbitBTC) July 3, 2019