With cryptocurrency markets falling as the Russia-Ukraine situation heats up, traders have spotted a new potential cause of conflict: China and Taiwan. Reports of Chinese aircraft entering Taiwanese airspace prompted concern that the country may be the “next Ukraine.” Taiwanese President Tsai Ing-wen has also urged for the island’s security to be beefed up in light of the Ukraine situation.
Cryptocurrency, like other capital markets, is subject to geopolitical tensions, as demonstrated by its reaction to the Ukraine crisis. This month, war-induced volatility wiped out up to USD 400 billion from the market. Taiwan is also the leading maker of semiconductors. Any interruptions in supplies from the nation would have far-reaching implications for the cryptocurrency mining business.
The West has implemented sanctions against Russia, it has avoided restricting the country’s access to the global banking system. Russia’s primary oil shipments to Europe are likewise unaffected. Last week, British Prime Minister Boris Johnson cautioned that a lack of Western support for Ukraine may create a dangerous precedent and endanger Taiwan.
China, which asserts Taiwan as its own sovereignty, recently stated that the country is “not Ukraine” and that it has always been an integral part of China. Taiwan has emphatically denied the accusation.