The Market for Bitcoin is a Hazardous Assets
The present dispute between China and Taiwan over Taiwan’s sovereignty is having an impact on the price of bitcoin. After Nancy Pelosi, the speaker of the US House of Representatives, visited the Asian nation, the issue has reached a crisis point. Aerial vehicles and naval warships swept across the area as Pelosi’s plane touched down safely. As tensions rose, the cost of Bitcoin and other digital currencies increased to reflect the turmoil.
The markets for BTC and all of the other cryptocurrencies are regarded as hazardous assets. As a result, they suffered from the hostility between China and Taiwan. The US and Chinese military boats were mobilized on Wednesday as the continuous tension between Taiwan and China approached a breaking point. The Japanese air force also took part in the operation. The daytime price of bitcoin dropped to $22,600 as a result of this stress.
After falling until Pelosi’s plane touched there, the price of bitcoin and other cryptocurrencies managed to jump beyond $23,000. Despite the fact that the most popular cryptocurrency, Bitcoin, is referred to as digital gold, every rise in local tensions and war threats has had a negative impact on the price of BTC.
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Bitcoin Plummeting With Russia’s Invasion
While Bitcoin and other cryptocurrencies have seen losses, the price of gold has risen throughout. According to experts, the move toward gold, the traditional safe asset, would grow if tensions between Taiwan and China rise. Also, withdrawals from the cryptocurrency money markets are possible if risk perception worsens. Given the historical statistics, it is reasonable to assume that in the case of a conflict between China and Taiwan, the markets for bitcoin and other cryptocurrencies will face a fall.
Bitcoin almost plummeted as Russia began its invasion of Ukraine. On the other hand, the price of gold started to rise. The immediate area around Taiwan is not the only place where tensions between China and Taiwan are rising. The USA, Japan, and the EU are just a few of the nations that will be drawn into the fight. As a result, the macroeconomic outlook is compromised, and risk taking declines.
Source: https://www.thecoinrepublic.com/2022/08/05/chinese-crisis-affecting-bitcoin-drastically/