Earlier this week, several major factors were mentioned, driving the current 40% bitcoin surge. These include Starbucks' support for Bitcoin payments and Whole Foods' acceptance of Bitcoin. Another reason is that Bakkt is preparing to launch bitcoin futures. The third is the rumor that eBay's online business heavyweight program is beginning to accept encrypted payments.
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However, the third point was rumored by the company's spokesperson at the 2019 Consensus Conference, saying that cryptocurrency is not accepted as a form of payment on the eBay platform and is not part of our payment strategy.
Now, Forbes presents another possible reason for the recent sharp rise in bitcoin quotes.
RMB exchange rate decline
Since US President Trump announced the increase of tariffs on Chinese goods, China is about to adopt the same measures. The first event caused the yuan to fall 2%. The second news caused the US stock market to fall, especially the Dow Jones index fell 696 points on Monday.
Now the Chinese are worried that in order to oppose the United States in this trade war and maintain China's commodity prices competitive to US citizens, the Chinese government will depreciate the yuan.
Chinese investors are seeking cryptocurrency investments to hedge
According to Forbes, analysts, including Dovey Wan of DHVC, a venture capital firm, and co-founder of the cryptographic company Primitive Ventures, the price charts for Bitcoin and the US dollar/RMB exchange rate now look somewhat similar.
Other cryptographic analysts have confirmed that Chinese investors are actively buying stable cryptocurrencies, especially Tether, to obtain funds from China and Hong Kong and profit from the renminbi. They say this may be the reason for the recent massive surge in Bitcoin.
According to CNBC, Andy Brenner of the National Alliance Securities Company believes that Bitcoin is another way for Chinese investors to hedge against current risks, fearing that the yuan may fall further. He said: If you are in China and want to diversify, it seems logical that Bitcoin will become a short-term substitute.
Chinese authorities boycott bitcoin
The Chinese government has been fighting cryptocurrencies since the implementation of the ICO ban in the fall of 2017. The next step after the ICO ban is to ban local cryptocurrency exchanges and prevent traders from using exchanges located abroad.
Now, the authorities are considering banned encryption mining in China, saying the industry is dangerous to the environment. However, OTC encrypted transactions are still being conducted in China through WeChat groups. (chain to finance)