The climbing of geopolitical tensions threaten to balkanize blockchain networks and restrict user access, said Crointelegraph leaders.
On April 9, US President Donald Trump announced a break in the deployment of prices imposed on certain countries – but the prospect of a world trade war is still looming, especially because Trump still wants to charge a 125% levy on Chinese imports.
Industry leaders have said that they fear a litany of potential consequences in the event of tension, including disturbances in the physical infrastructure of blockchain networks, regulatory fragmentation and censorship.
“Aggressive prices and commercial reprisal policies could create obstacles for node operators, validators and other main participants in Blockchain Networks,” said Nicholas Roberts-Huntley, CEO of Concrete & Glow Finance, Cointelegraph.
“In moments of global uncertainty, the infrastructure supporting crypto, not only the assets themselves, can become collateral damage.”
According to CoinMarketCap data, the total market capitalization of the cryptocurrency dropped approximately 4% on April 10, while merchants weighed contradictory white house messages on prices in the middle of a macroeconomic discourse.
Crypto market capitalization was traced on April 10. Source: Coinmarketcap
In relation: Trade tensions to accelerate the adoption of institutional cryptography – managers
Bitcoin vulnerabilities
Bitcoin (BTC) is particularly vulnerable to a trade war because the network depends on the specialized equipment for Bitcoin exploitation, such as the ASIC chips used to resolve the cryptographic evidence of the network.
“The disrupted prices have established ASIC supply channels,” said David Siemer, CEO of Wave Digital Assets, at Cointtelegraph. Chinese manufacturers such as Bitmain are key suppliers for minors.
However, “the greatest threat is the erosion of the Blockchain fundamental value proposal – its global and unarmed infrastructure,” said Siemer. This could be particularly problematic for daily cryptography holders.
“If global trade is breaking down and capital controls are tightening, it can become more difficult for citizens of restrictive countries to acquire bitcoin,” said Joe Kelly, CEO of Unchained. “Governments could suppress exchanges and ramps, which makes accumulation and use more difficult,” added Kelly.
Bitcoin’s performance against actions. Source: 21hares
Ironically, these types of fears also highlight the importance of cryptocurrencies and decentralized blockchain networks, the leaders said.
Bitcoin has already shown “signs of resilience” in the middle of market turbulence, highlighting the role of the medal in coverage against geopolitical risks.
“Although the environment is difficult, it also creates an opening for the crypto to prove its long -term value and usefulness on the world scene,” noted Neil Chopra de Fireblocks.
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