Bitcoin Climbs: The Numbers Behind the Rise

In a dramatic shift, Bitcoin’s value has begun its ascent once again, climbing from a modest $618 to $633 within just three hours, reflecting a solid +2.5% increase. What’s spurring this excitement in the crypto market?

The catalyst appears to be the Chinese yuan’s unexpected tumble to a six-year low on October 10, leaving many wondering if this is a sign of a more prolonged depreciation. As the holiday came to a close and trading resumed, signs of yuan weakness emerged, suggesting that Beijing might be letting the currency slip after a period of stability.

Chart Talk: BTC vs. BTCCNY

CoinMarketCap isn’t just whistling a happy tune; Trading View charts paint a similar picture. Between 5 a.m. and 6 a.m. that very morning, Bitcoin’s trading rate in yuan jumped from 4150 to 4260, marking an impressive 2.7% increase.

Historical Context: Bitcoin’s Peaks

Historically speaking, Bitcoin’s current price point feels a bit like déjà vu. This level has only been reached twice before: once just before the infamous Bitfinex hack in 2016 and again between late 2013 and early 2014. So, is this the beginning of a new trend or merely a flash in the pan?

RMB and the SDR: A New Player on the Global Stage

Let’s not overlook the Chinese renminbi’s recent starring role. As of October 1, 2016, the RMB was officially included in the IMF’s Special Drawing Right (SDR) basket. This places it third overall, right behind the mighty U.S. dollar and euro, fundamentally reshaping global financial dynamics.

• U.S. Dollar: 41.73%
• Euro: 30.93%
• Chinese Renminbi: 10.92%
• Japanese Yen: 8.33%
• Pound Sterling: 8.09%

Speculative Future: What’s Next for Bitcoin?

With the renminbi now playing a vital role in the global economy, its depreciation could lead to a steady rise in Bitcoin prices—albeit potentially marginal at first. This speculation is stirred further by Goldman Sachs’ warnings regarding the increasing capital flight from China, with money leaving in yuan rather than dollars. The implications for Bitcoin? A potentially fruitful opportunity for investors as they navigate these treacherous waters.