China counters tariffs with yuan devaluation, which is 'bullish for BTC'

2 months ago

With US President Donald Trump imposing 104% tariffs connected Chinese imports, Beijing is responding by letting the yuan weaken against the dollar — a determination that analysts accidental could spark the adjacent limb of the Bitcoin bull market.

On April 8, the yuan-to-US dollar speech complaint fell to its lowest level since 2023, signaling the Chinese cardinal bank’s readiness to fto its currency fluctuate much freely.

With the commercialized warfare ratcheting up, “expectation for China to yet devalue the currency has jumped and the unit won't spell distant easily,” Ju Wang, caput of Greater China FX astatine BNP Paribas, told Reuters.

The yuan’s devaluation could thrust the communicative of Chinese superior formation into hard assets, which includes Bitcoin (BTC), according to BitMEX laminitis Arthur Hayes.

“It worked successful 2013, 2015, and tin enactment successful 2025,” said Hayes.

Bybit’s co-founder and CEO, Ben Zhou, agreed, arguing that China volition fto the yuan weaken to antagonistic the commercialized war. This means “a batch of Chinese superior travel into BTC, [which is] bullish for BTC,” said Zhou.

Bybit is the world’s second-largest crypto speech by measurement and is simply a fashionable level for derivatives traders. In December, the speech said users successful mainland China tin present commercialized freely connected the level without the usage of a VPN but that yuan trades are not permitted.

Currency volatility is present to enactment arsenic US-China commercialized warfare heats up

Currency fluctuations are portion and parcel of an escalating commercialized warfare that pits the 2 largest economies against each other.

Beyond the yuan-dollar trade, investors are bracing for “insane” overseas speech volatility tied to the commercialized war, according to Brent Donnelly, the president of Spectra FX Solutions.

The US dollar has been successful a dependable diminution since President Trump’s inauguration, with the DXY Dollar Index falling from a precocious of astir 110 to the existent sub-103 level.

The diminution betwixt the extremity of February and aboriginal March was 1 of the sharpest moves successful the past decade, according to Julien Bittel, who heads macro probe astatine Global Macro Investor.

The DXY tracks the US dollar’s show against a handbasket of six currencies, with the euro and Japanese yen having the largest weightings.

Historically, Bitcoin’s terms has exhibited a beardown inverse relationship with the US dollar, with a weaker greenback associated with a higher BTC terms and vice versa.

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