Bitcoin climbed past the US$11 000 level for the first time since mid-July to lead gains among the biggest cryptocurrencies, as risk assets across Asia tumbled on escalating trade war tensions.

The largest cryptocurrency surged as much as 12% from Friday’s close and traded at $11 565 at 12.50pm in Hong Kong, according to consolidated Bloomberg pricing. The Bloomberg Galaxy Crypto Index tracking a basket of cryptocurrencies jumped as much as 7.2% as rival digital coins including ether and XRP also rallied.

“With the turmoil in markets and the streets, suddenly digital gold doesn’t seem like such a bad idea,” said Jehan Chu, managing partner at blockchain investment and advisory firm Kenetic Capital. “Bitcoin is increasingly seen not only as a bet on the future, but as a shelter for the present.”

China’s yuan fell past 7/dollar, a key psychological level for traders, roiling global markets and driving other currencies lower. The risk-off shift intensified on reports China had asked state buyers to halt imports of American agriculture imports, further escalating trade tensions after US President Donald Trump last week proposed adding 10% tariffs on another $300-billion in Chinese imports starting 1 September.

“A lot of this might have to do with some capital flight out of China” after Trump’s tariff announcement, said Tom Maxon, head of US operations at electronic payment products company CoolBitX. He noted that it’s hard to tell for sure, and said the current bitcoin bull market has produced a lot of positive dynamics that could be fuelling the move as well.

Tripled

Bitcoin’s rally this month comes after a July sell-off as lawmakers including Trump questioned Facebook’s plan to create its own cryptocurrency, libra. The digital currency has seen prices triple this year after a difficult 2018.

“Bitcoin should test $12 000 soon,” said Charles Yang, head trader at Hong Kong-based over-the-counter digital-asset trading firm Genesis Block. “This is, of course, assuming we believe macro issues actually drive bitcoin.” — Reported by Eric Lam, with assistance from Matt Turner and Zheping Huang, (c) 2019 Bloomberg LP