Trading has heated up this week as The PBOC set its daily yuan fixing rate at 6.8291, the lowest level since September 2009.
After a volatile week in global markets in which the US dollar strengthened, interest rates moved smartly higher, and gold came under extreme selling pressure, bitcoin was one of the beacons of strength, holding its value at the 700 BTC/USD level.
How large of a role does the weak performance of the Chinese yuan play in last week’s Bitcoin trade? With over 80% of the bitcoin trading volume expressed in the Chinese currency, CryptoNinjas feels that a weak yuan regime provides a tailwind for the currency.
Central banking policy that favors a weaker currency forces market participants to look for other places to park money to avoid devaluation. Bitcoin has gained extreme popularity in China as a store of value during the latest cycle of PBOC devaluation.
CryptoNinjas will continue to analyze the different factors and variables that can affect bitcoin and other cryptocurrency prices to keep you ahead of the currents that move swiftly, and often silently, under the surface of global markets.