Economists at global investment bank Goldman Sachs believe there to be no end in sight to the ongoing US-China trade war. Although damaging to economic interests in both nations, the lack of resolution may well be bullish for Bitcoin.

The cryptocurrency has historically performed well at times of heightened geopolitical tension. This is due to its some of the asset’s hard monetary policy.

Goldman Sachs Economists Fear Trade War May Lead to Recession

According to a report in Reuters, a note to clients sent out yesterday by Goldman Sachs states that the bank is expecting that the US-China trade war won’t be resolved before the 2020 presidential election. Economists from the global banking giant also stated that they believed a recession to be likely.

Goldman Sachs believe the 10 percent tariff on the last $300 billion of Chinese imports will go into effect, as planned, on September 1. In response, China has threatened to stop buying US agricultural products. The bank does not think a resolution likely in 2019.

The trade war has been going on now for more than a year. It has largely focused on issues relating to tariffs, intellectual property, cyber security, and technology.

The note, authored by three of the bank’s prominent economists, Jan Hatzius, Alec Phillips, and David Mericle, read:

“Overall, we have increased our estimate of the growth impact of the trade war.”

The note also stated that the bank had lowered its fourth-quarter US growth forecast

Bitcoin as a Safe Haven?

As part of the ongoing trade war, the US has accused China of manipulating its currency to damage the profitability of American exports. China denies doing this.

However, whatever the cause, the yuan has been depreciating in value versus the dollar a lot of late. Such economic conditions have caused some Bitcoin analysts to speculate that the recent run up in the value of the cryptocurrency has been caused by members of the Chinese public wanting to protect the purchasing power of their savings against the devaluing yuan.

Maybe just a coincidence but you tell me Bitcoin is winning the trade war while China and US is a lose-lose pic.twitter.com/8FmVcaHjjh — Dovey 以德服人 Wan ?? (@DoveyWan) May 13, 2019

If such a theory is correct, Bitcoin may benefit greatly from the continuation of the trade war and a recession following it. If capital has already been flowing from the yuan to BTC, it stands to reason that it would continue during a prolonged trade war.

However, not everyone is convinced that Chinese investors are driving the cryptocurrency’s current price moves. Bitcoin naysayer and gold bug, Peter Schiff Tweeted earlier this month that he thought that the whole suggestion was fabricated by CNBC to push the Bitcoin price up:

“CNBC is trying its best to dupe its audience into buying Bitcoin. Despite gold being a much larger market, CNBC devotes far more airtime to Bitcoin. The Chinese aren’t buying Bitcoin as a safe haven. Speculators are buying, betting that the Chinese will buy it as a safe haven!”

Related Reading: Could U.S. Tariffs Be Behind Bitcoin’s Rally Towards $11,000?