Prominent crypto analyst @tedtalksmacro recently took to Twitter to highlight an interesting trend in the world of cryptocurrency. He noted that the increase in Chinese liquidity has coincided with a rise in the price of Bitcoin (BTC), a recurring theme throughout this year.
The actions of the People’s Bank of China (PBoC) are primarily aimed at stimulating the domestic economy. However, they have also indirectly impacted the cryptocurrency market. China’s implementation of “quantitative easing” has shown a correlation with the growth of the total cryptocurrency market capitalization (TOTALCAP) since the beginning of 2023.
Adding to the positive developments, Hong Kong, which is striving to become Asia’s cryptocurrency hub, has released encouraging reports. The region, which falls under the People’s Republic of China, plans to fully legalize the buying, selling, and trading of cryptocurrencies in June. Moreover, it aims to serve as a gateway for mainland Chinese institutions to enter the cryptocurrency space.
PBoC Had a Favorable Impact on BTC
Interestingly, the actions of the People’s Bank of China have had a favorable influence on Bitcoin’s price. @tedtalksmacro, a prominent crypto analyst, regularly tweets about Bitcoin (BTC) and the liquidity injections from the PBoC. His observations reveal that the significant liquidity injection in early 2020 was correlated with the macro bottom of Bitcoin’s price. Similarly, the current injection of cheap cash, which is currently underway, appears to follow shortly after the bottom of the preceding bear market.
As we navigate through an uncertain post-pandemic recovery, it is likely that the PBoC will continue its approach if economic data continues to disappoint. The impact on both the domestic economy and the cryptocurrency market will be worth monitoring as we progress into the rest of the year.
While the relationship between Chinese liquidity and Bitcoin’s price may not be the sole factor influencing the cryptocurrency market, it serves as a notable aspect to consider when analyzing trends and developments in the space. Investors and enthusiasts alike will be watching closely to see how these dynamics unfold in the coming months.
The news comes at a time when the price of Bitcoin has surged in the last seven days. According to CoinMarketCap data, BTC is trading at $30,555, with a 15.7% surge in the last seven days.
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- Source: https://coinpedia.org/news/crypto-live-news-chinese-liquidity-boost-coincides-with-bitcoins-rise-says-prominent-crypto-analyst/
