Could trade wars boost Bitcoin’s price?

You may have noticed that trade wars are trending. The US versus China being one of the biggest and most reported, but not the only one. Panos Mourdoukoutas writing at Forbes suggests that these clashes over trade could make bitcoin and the leading altcoins a “safe haven” and send their prices skyrocketing.

Once upon a time gold was a safe haven for investors at times of strife, but has lost some of its appeal due to a strong US dollar and what is called a high “carry” cost.

The US Treasury is another safe haven, but China is holding over one trillion dollars of treasury notes and if things take a further dive between Trump and Xi, then the Chinese may well decide to crash the market, using it as a weapon against the USA.

Mourdoukoutas believes that this leaves us with cryptocurrencies as the place to store money while the trade wars continue. Although, he does point out that there is a high element of risk involved in this strategy.

He also claims that other experts on the markets agree that cryptocurrencies have already been boosted by the trade war to date. Nisa Amoils, a venture capitalist with New York Angels said, “While infrastructure build-out and Facebook’s Libra have validated the space in recent months, this continues to be a macro story. The largest catalyst continues to be the deteriorating global macro backdrop, which continues to support digital assets, especially Bitcoin and to a lesser extent the innovative ‘decentralized finance’ movement occurring on top of the Ethereum protocol.”

Amoil agrees that cryptocurrencies are pushing gold into the background and that bitcoin is “digital gold”, a view held by some, but not by everyone.

Deric Scott, Vice President of Metals.com said, “Gold is universally accepted as currency around the world and has been for nearly 6,000 years. It’s tangibility and anonymity make it very appealing for people looking to retain what little shred of privacy we as a collective society still have.”

Scott also thinks that gold is superior to crypto because it doesn’t rely on the Internet, saying, “it’s a nice way to store wealth that is still accessible even when the power or Wifi is out.” It’s a point, but not one that techie people are likely to take very seriously.

Mourdokoutas also refers to the fact that central banks are getting ready for another round of easing, and that could be positive for speculative assets, including major cryptocurrencies. This could push the prices to new highs, simply because cryptocurrencies have a limited supply.

It all makes watching the trade war news even more interesting if you’re a cryptocurrency owner.

Trump’s unwittingly reveals the ‘bigly’ power of bitcoin

Many of you will have read Trump’s recent tweets; the ones where he proclaimed that he isn’t a “fan” of bitcoin. In the President’s opinion, bitcoin and other cryptocurrencies are not money, unlike the mighty US dollar, which he believes is the strongest currency in the world.

And while he was tweeting about bitcoin, he took the opportunity to take a swipe at Facebook’s Libra. He said “it will have little standing or dependability” and then went on a rant about banking licences, posting: ““If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks, both National […] and International.”

This was not the end of his tweets. It seems that once Trump gets his teeth into a topic, he just can’t stop tweeting. He finished off his diatribe against cryptos by moaning about how crypto facilitates “unlawful behavior, including drug trade and other illegal activities.” Somebody obviously told him this once and it has stuck in his head, never mind the fact that most drugs in the USA are bought with US dollars, Trump’s favourite currency. And he had to tweet about how strong, dependable and reliable the dollar is as well, just to drive the point home.

Did Trump’s tweets affect crypto prices?

Interestingly, just before Trump unleashed his anti-crypto tweets, bitcoin’s price rose. However over the last few days we have seen a big price correction for bitcoin and across the leading altcoins.

But don’t think this is because of Trump. There is another way to look at it as as Michael J. Casey at Coindesk explains. He writes, “What matters is the very fact that a sitting president mentioned cryptocurrencies at all. Indeed, from a price perspective, Trump’s disparaging remarks are, on balance, positive for bitcoin.” And he adds that by Friday evening this was clear in the post-tweet price behaviour of bitcoin.

Furthermore, his argument continues along an important line: ““More importantly, the tweet marks a symbolic milestone in the gradual but ever-expanding presence that cryptocurrency occupies in the public conversation around money and policy.”

Trump reveals bitcoin’s power

What Casey is saying is that Trump has unwittingly started a battle over the future shape of global money systems. As he says, bitcoin and crypto in general has to be relevant to us the people to enjoy success. The fact that Trump has tweeted about it reveals that it is seen as a threat by governments, and that means it is relevant. Casey says, “By simply giving it the time of day, Trump revealed that people within the high levels of the U.S. power structure are noticing the challenge that cryptocurrency technology poses to it.” Yes!

The response of the massive Crypto community on Twitter showed that they didn’t take the President at all seriously. And why would anyone, when the President announced on 4th July that American soldiers took over airports from the British during the American War of Independence in 1775?

A letter to Facebook

Bitcoin is becoming a big brand

How big are these news headlines?

· Bitcoin surpasses 1 M daily active addresses.

· Uber provided an estimated 14 M rides per day in 2017.

· Apple sold 798,877 iPhones per day in 2017.

· OLA & Uber combined provide an estimated 3.5 million rides per day in India.

The virus has already spread! And it’s a good news for bitcoin.

According to CoinMetrics.io, there are now over a million daily active addresses, a number that is defined as the number of unique “from” or “to” addresses used per day. This is something we haven’t seen since November 2017, at the height of the bitcoin buying frenzy.

As Coindesk reports, one Twitter user, Kevin Rooke, noticed the movement this week and tweeted: “When Bitcoin first broke 1 million active addresses (Nov 27, 2017), 1 BTC was $9,352 and the median tx fee was $3.23.Yesterday 1 BTC was $8,230 and the median tx fee was $1.33.”

While some might say that this statistic isn’t that important, it certainly shows us one thing — there are people using bitcoin on a regular basis, whether for trading or spending. It is a good stat for bitcoin, regardless of what those who criticise it say.

From the statistics at the beginning of this article, you can see that there is a context for the figure. Take a look at the figures for Uber.

On the face of it, Uber is doing ‘better’ than bitcoin, because it has 14 million daily users globally. But you have to consider the fact that shifting from using a standard taxi to using Uber is much simpler for most people than changing from using fiat currencies to a cryptocurrency. So, the comparison is not exactly fair.

Then again, Apple is selling just under one million phones on a daily basis, putting bitcoin slightly ahead of it.

Ultimately, what can we take from these figures? The answer is that bitcoin is seeing the same kind of transaction volume as some of the world’s leading brands, which is quite an achievement, and shows that bitcoin is not just the leading cryptocurrency; it’s becoming the big brand of the cryptocurrency space.