Bitcoin broke above $8000 from $6000 in less than five days, the probability of which was lower given the current market sentiments. The recent parabolic rise is a rarity in the financial markets. However, it is not as rare in the crypto-markets.
The two most important factors that have been credited for the rise has been Institutional growth and the recent tension between the US and China which has favored the uncorrelated global asset, Bitcoin. Bitcoin, as the experts suggest is acting as a safe haven against the falling Chinese currency.
Anthony Pomp, the Founder of Morgan Creek Digital and a Bitcoin proponent tweeted,
” JP Morgan is telling people that the trade war between the US and China could boost safe haven currencies. Bitcoin is the best safe haven currency in the world. “
A leading cryptocurrency analyst, Dovey Wan cited a considerable correlation between the drop in Yuan and the rise in Bitcoin in a tweet. Correlation doesn’t often mean causation. However, the recent tension and increase in tariff rate by the US and China with the stocks plummeting, has had many experts analyzing this perspective.
Maybe just a coincidence but you tell me
Bitcoin is winning the trade war while China and US is a lose-lose pic.twitter.com/8FmVcaHjjh
— Dovey Wan 🗝 🦖 (@DoveyWan) May 13, 2019
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The fact that the cryptocurrency market is operational 24/7 and trading occurs around the world like clock-work also makes the asset class different from traditional Exchanges.