As cryptocurrencies gear up for new highs, Donald Trump enters the scene, potentially upending the market.
The Bitcoin
$0.000049 price hovers above $118,700, yet unsettling announcements have emerged during the writing of this piece. Trump had alluded to severe sanctions against Russia roughly two weeks ago, and while the feared measures did not materialize last Friday, they could still come to pass this week.
Potential Downtrend for Cryptocurrencies
This Friday, Trump and Putin are scheduled to meet in Alaska. If no agreement is reached, or if Trump feels misled, significant secondary sanctions on Russia might be imposed. Meanwhile, Vance, the second-in-command of Trump’s cabinet, has started discussing even graver scenarios.
China and India, two of the largest importers of Russian oil, would be directly impacted by these secondary sanctions. As Vance stated, China is far more complex compared to India, with Trump contemplating imposing sanctions on China due to its oil dealings with Russia.
Economic Tensions Amplified
According to a report by FT, China is seeking concessions from the US as part of a trade agreement, specifically the relaxation of chip export controls. Tariffs on China are expected to be extended in two days. Although some announcements have hinted at this extension, the issue of secondary sanctions could render the agreement meaningless. Even if tariffs are frozen, China would still face taxes exceeding 100% due to these sanctions, with dire implications for global markets and consequently, cryptocurrencies.
In statements to Fox News, Vance praised President Trump’s historic peace negotiations in Eastern Europe. However, while sanctions are underway, so are commendations for the negotiations. It remains to be seen which side of the scale will tip heavier in the coming days.
