Bitcoin Crosses $22,000 – Trustnodes

Bitcoin rose again above $22,000 for the first time in almost a month, while eth fell slightly as the ratio drops to just below 0.079 from a recent peak of 0.085 BTC.

The ping pong may thus be back, and potentially due to macro giving bitcoin a new narrative amid some bullishness for ethereum ahead of the merger this Wednesday.

China, the Asian titan is in a bit of a panic amid a strengthening dollar that has local media setting off some sort of alarm bells.

A currency fell 45% and a country went bankrupt, their headline claims, with the text pointing to Sri Lanka, which is apparently the dollar’s fault and not China’s debt trap.

The yen and South Korean won have fallen 20% against the dollar, and the euro has fallen 10%, while China’s yuan is the strongest, down 8%, they say.

Changing the page, their semi-panic tone continues to say that shipping rates have fallen to their lowest since August 2020. A video has gone viral showing a port full of containers. Is the foreign trade situation bleak? – they ask.

Another side says that it is the EU that is apparently complaining about US trade protectionism in not subsidizing European-made electric cars in the Inflation Reduction Act – better known as the Renewables Support Act.

Smart, that, because it’s probably true, but it’s more aimed at bringing back some high-tech manufacturing that has gone to China.

Apparently the US is now planning to bring back biotechnology as well. The Biden administration is going to make trouble again, a rough translation says about it.

That’s while Chinese President Xi Jinping, on the brink of being officially declared dictator next month as he teeters on the brink of unilaterally removing term limits, gets to meet Russian President Vladimir “I shoot at civilian infrastructure because soldiers are scary” Putin.

This comes on the back of one of the biggest defeats for the Russian army, certainly since Libya, as Ukraine liberates an area twice the size of Greater London.

Ukraine is huge though, and it’s still a lot of occupied red, before you even get to Crimea or Donbas, but the surprise blitzkrieg might well make some atheists believe in some kind of god.

Because it appears as a kind of miracle, even if the Russians are not too wrong when they say that Ukraine is supported by the whole West.

By that they are probably implying that the West is obviously far too strong and losing to them is okay, and maybe even that Russia can’t win.

It’s a decent way out, but with a month to go until the big ‘congress’, this meeting is one to watch as mistakes by dictators – although officially none of them are yet – cannot be ruled out, and thus this meeting potentially settling things like these shipping rates collapsing completely.

We have no further speculation in this sensitive matter. Let them make their decisions first.

But there is plenty of speculation about inflation, and it is only in one direction: down. Gone, in fact, as far as markets are concerned. Even if the data ends up saying otherwise, who cares about reality, right.

But not without reason. Energy prices are now the government’s problem. At least in the UK, but Germany also announced a €65 billion package. So everywhere.

If the government covers the cost, it is through loans, not printing. So money being shuffled around, rather than new money, in theory.

The money to the City of London, as well as New York. And then America, Britain, Europe are fine because their governments are not poor, it’s just accounting right.

The rest? Well, occasional country bankruptcies have sort of become the norm today. These countries also tend to have strict capital controls, so the bitcoin hedge may well continue to rumble, but just don’t call it a hedge anymore.

However, there is little difference between bitcoin and eth, so why are all these changes in the macro causing bitcoin specifically to jump, and more so than eth.

The answer may simply be that if bitcoin can satisfy these needs, why should they bother with eth?

There are reasons, including the entire financial system on eth, but from remote villages to sophisticated trading houses, bitcoin comes first because it was first.

And so it first benefits from the macro change, but why didn’t it benefit positively from the huge volatility in the currency markets?

One answer may well be that you can temporarily suppress bitcoin, but not in the medium to long term, and after such attempts last year, some systems may have come back online.

Another reason may well be that bitcoin is not actually correlated, it may just appear that way in the short term. One way to put it is to ask: did the dollar rally crash bitcoin, or did bitcoins crash the dollar?

The Euro didn’t buy bitcoin to potentially hedge against dollar volatility because they may have thought bitcoin was too high at $70,000.

Likewise, this recent bitcoin jump may also have nothing to do with macro, just the usual ping-pong between bitcoin and eth that we see almost every time one of them turns bullish, while the other keeps up even then to lead.

But if the dollar weakened too much while bitcoin rose, it may now have strengthened too much while bitcoin fell.

Both can also be due to unrelated causes. The US is still an importing economy. While the economy prospered, the dollar weakened because it had to be converted into other currencies to buy other nations’ goods.

The massive growth obviously can’t continue at 20% a quarter, or even 5%, but hopefully maybe 3%.

So there was some adjustment, and that adjustment may now be over, with the money shuffling perhaps pointing to a trend as the West appears to be coming out much stronger from some major tests that, so far at least, appear to have passed fairly successfully.