Cryptocurrency and Bitcoin in particular receive support from the most unexpected source. Chinese investors. Although crypto trading is prohibited in the country, the market in China has been active since 2021.
Experts say the demand for BTC from local investors was triggered by a 30-year run loss in the stock market. In simpler words, market participants are looking for alternative investment opportunities. Bitcoin receives enough support. The coin is associated with another safe-haven asset like gold. More and more active traders started moving their funds into cryptocurrency.
Despite the current ban, Chinese investors can still trade BTC. However, it is recommended their transactions do not exceed $7,000 (approximately 50,000 yuan). Bigger orders can drive the attention of local authorities and regulators. As a result, the majority of local investors hold portfolios featuring around 50% of crypto among all assets.
Since residents in China can still trade tokens like Bitcoin over the counter or on cryptocurrency exchanges like OKX and Binance, the market is currently ambiguous. Another choice is to open bank accounts abroad in order to purchase cryptocurrency.
Hong Kong has another opportunity for accumulation: Chinese traders are entitled to a $50,000 yearly foreign exchange purchase, which some have utilized to buy cryptocurrency on the Hong Kong exchange. And as China's real estate industry struggles, more people may likely opt for cryptocurrencies in an effort to make up for lost profits.
Even though the government tried to support the industry, which was once a major contributor to the second-largest economy in the world, the country's real estate market concluded 2023 with the worst drops in new home prices in almost nine years. So, market participants are looking for alternative and stable assets giving more support to Bitcoin.
May the trading luck be with you!