Bitcoin included (Cryptography: BTC) When it appears to be regaining momentum, there is reason to believe there is a new tail that will help it, just like the potential catalyst on the horizon.
Let’s take a look at both of these factors, as they are both related to China and its Bitcoin policy.
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Since 2021, 21.1% of the world’s Bitcoin has been produced domestically, despite it being illegal to mine and trade Bitcoin in China. This means that the Bitcoin-related policies pursued by China will have a significant impact on the price of the coin and its prominent future impact. And there is reason to believe that the state’s position on the coin is slowly changing in a way that is beneficial to its owners.
In February, China’s Supreme Court met with other judges and legal experts to assess the legal status of cryptocurrencies and the sector’s potential regulatory framework. While there was no widespread legalization as a result of that meeting, it is an important step forward, as it shows that the current law is not set on stone.
One factor spurring the potential change in the country’s policy is the storage of Bitcoin seized from enforcement measures, some estimates ranging from $16 billion to $19 billion, and after one possibility of the US has been debated, China will stockpile those assets in strategic reserves similar to US assets’ non-map policies. It spurs the coin’s upward price pressure and represents a major new catalyst, but not the only benefit that could arise from changing regulations.
Regardless of what the government says, Chinese citizens are buying bitcoin at their counters from Hong Kong-based crypto banking services. The total amount of these transfers is difficult to assess. Nevertheless, given the number of these services present and the large population of the country, there could be ample buying activities to be carried out to provide a modest tailwind for the price of coins. Legalization will likely increase its effectiveness significantly.
China’s economic policies are also changing. Domestic consumption and investment are encouraged through stimulation of financial markets. More money into people’s pockets means people have more disposable income to invest in. Some of that additional capital will undoubtedly flow into Bitcoin. Bitcoin is a new tailbone that hasn’t been played in recent months.
The story continues