The trade war between the US and China has escalated after President Donald Trump imposed new tariffs. This has serious implications not only for the economy but also for the cryptocurrency market.
Trade War and New Tariffs
President Donald Trump heightened tension in trade relations by imposing an additional 104% tariff on Chinese goods. This step has led to a global tariff war, to which China has already responded with hints that it will not succumb to US pressure.
Cryptocurrency Use for Settlements
According to recent reports, Russia and China have begun using Bitcoin and other cryptocurrencies for energy-related transactions. Matthew Sigel, head of digital assets research at VanEck, explained how the new tariffs impact Bitcoin, suggesting that they serve as an alternative for countries to conduct trade. Sigel stated, 'China and Russia were recently revealed to be settling some energy transactions using Bitcoin — just as we anticipated.'
Prospects for Bitcoin and Other Cryptocurrencies
The situation highlights the shifting perspective on cryptocurrencies as hedging tools and currencies for global trade. This was also evident when uncertainties arose in the markets, with Bitcoin stabilizing and outperforming equity indices, indicating rising global demand.
In the context of an intensifying trade war and global market instability, countries are seeking alternatives for settlements, making cryptocurrencies increasingly attractive and beneficial tools for trade.
