Bitcoin traders should keep an eye on the ongoing slide in the yuan, analysts say.
That’s because, historically, the cryptocurrency looks to have put in a positive performance during bouts of weakness in the Chinese currency.
The yuan (CNY) fell to 7.1613 per U.S. dollar earlier on Tuesday to hit the lowest level since early September and taking its cumulative month-to-date and year-to-date losses to 1.4% and 2.85%, respectively.
The decline to eight-month lows could be associated with concerns about the U.S. response to China’s proposed security law for Hong Kong and the resulting haven demand for the greenback. U.S. Sen. Marco Rubio (R-Fla.) put out a tweet late Tuesday stating the U.S. would impose sanctions on China if the nation presses forward with implementing the controversial Hong Kong bill.
“If China’s CNY continues to weaken against USD, then we could have a 2015 and 2016 repeat, where BTC strength coincided with yuan weakness,” tweeted Chris Burniske, partner at venture capital firm Placeholder.
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Source: Bityard (https://support.bityard.com/hc/en-us/articles/900001071063-Slipping-Chinese-Yuan-May-Boost-Bitcoin-Price-Past-Data-Suggests)