The China–United States trade war has resulted in Chinese investors choose Bitcoin as a way to make savings.
This August, the yuan dropped to its lowest for 10 years. The move was in response to U.S. President Donald Trumps threats in early August to impose a 10 percent tariff on Chinese imports.
According to analysis of prices over 30 days, the negative correlation between the yuan and bitcoin has fallen to a record low in the last seven days.
As a reminder, the inverse correlation between bitcoin and the yuan also notched up in April and May as the tensions ratcheted up with the deterioration on U.S.-China trade relations.
Manifestations of instability in world markets and the risks associated with trade wars push investors to use cryptocurrencies as a safe haven asset, an alternative financial instrument that is not dependent on traditional factors. Currently, the main focus of instability is the flaring trade war between the United States and China.
One of the main driving forces of this conflict is Trump’s systemic position, who seeks to oust Chinese players from the US market by any means. The US President’s tweet about the introduction of next customs barriers in the form of a 10% duty on Chinese goods allowed Bitcoin to quickly add 5% in 24 hours.