The Chinese yuan's decreasing luster is not only sending jitters around global financial markets, but it also allows cryptocurrency to become more attractive as Bitcoin slowly climbs to a new high of $15,000.
China's yuan (CNY) collapsed to under-7 mark against the US dollar (USD) early Monday, it's weakest in over 10 years, triggering a domino effect in the stock market and causing a spike in government bonds.
Bitcoin (BTC) soared 10% as stocks around the world were jolted by the yuan's weakening courtesy of the US-China trade conflict. As the yuan falls, the crypto rises, said Nigel Green, DeVere Group Founder, and CEO.
The rise of the world's most popular digital currency is not a coincidence and proves its intrinsic value as a go-to safe cushion when the economy turns sideways. "During times of market uncertainty bitcoin realizes its reputation as a form of digital gold," Green pointed out.
One of the driving factors behind the crypto's upward momentum and as a safe-haven asset is it allows investors to bet their cash in digital form when the markets are unstable. With the rising animosity between Beijing and Washington, not to mention the Brexit case, the virtual currency could enjoy more inflows into investments in the coming weeks.
Tyler Winklevoss, one of the pillars of the Gemini Exchange, disclosed on Twitter that digital currency needs to breach the $10,000 barrier, and $15,000 is a crucial bet. Furthermore, Winklevoss is not the only advocate to project another increase.
Fundstrat co-founder Thomas Lee is certain that Bitcoin would easily move up within the $20,000 region. Oliver Isaacs, a crypto strategist, expects that the crypto could even rally near the $25,000 level before 2019 ends.
For Green, he believes that bitcoin - which has the same attributes as gold - has the capability to outshine the time-proven safe-haven yellow commodity as the ultimate protection in times of economic crisis "and as the world becomes increasingly digitalized."
With the United States now officially - and figuratively - dropping the bomb on China as a "currency manipulator", Green also believes that investors are now more inclined to run towards decentralized and more secure currencies like Bitcoin to protect their money from the instability now transpiring in the global markets.
Although cryptocurrency, at least for now, gives clear signs of safety, market observers estimate that different developments in the virtual markets could push the price of Bitcoin higher. BTC is "notoriously" unpredictable, yet its status becomes ever more appealing, especially when things around it lose theirs.
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