Trade tension between the Trump administration and the Chinese government continues to escalate, and more users are seeking shelter in Bitcoin
Since December 2018, the Chinese government makes moves toward enlarging their gold reserves. With the added 190,000 ounces of gold in August, the total gold accumulation over the past eight months is close to 100 tons.
Central banks worldwide are lowering their interest fees, trying to get rid of the accumulated bank reserves. The Trump administration also took a hit on Russia, and the response is similar to the Chinese — the Russian government is on a gold spree.
As a result of the sanctions the U.S. is imposing on both countries, the price of gold skyrocketed with 18% since the beginning of 2019. The precious metal hit a six-year high, reaching $1,550 per ounce, according to Goldprice.org. As of press time gold trades at $1,509.65.
As China’s national currency is rapidly losing positions against the U.S. Dollar, more and more users are shifting their focus toward cryptocurrencies. Chinese are converting their savings into Bitcoin, as they seek a way to preserve the value of their funds. Premiums, however, are steep, as some crypto exchanges offer Bitcoin and other cryptocurrencies with up to $1,000 on top.
The Hong Kong protests, aimed at the Chinese banks, are also a catalyst into migrating the funds of the world’s largest populations toward a decentralized option.
The accumulation of Bitcoin will result in a price boost, as the world’s largest cryptocurrency managed to stay above $10,000 for the past week. Despite volatility issues, trading volumes are returning to normal rates. As of press time 1 BTC is trading at around $10,350, with almost $15 billion in daily trading volumes, and a market capitalization of $184,4 billion.