Bitcoin Could Be on the Edge of a Major Price Swing

Bitcoin BTC $79 058 24h volatility: 2.3% Market cap: $1.57 T Vol. 24h: $68.99 B , the world’s largest digital asset, could be on the edge of a major price swing.

Key Notes:

* China’s yuan weakened beyond a key level on Monday as the People’s Bank of China (PBOC) set the daily reference rate at 7.2038 against the dollar.

* This is the lowest fix since September and signals a shift in how the central bank manages the currency.

* The yuan cannot float freely like the US dollar or the euro. It trades within a 2% band on either side of a set rate announced each morning by the central bank.

* Many experts believe this decision is a response to renewed pressure from the United States.

* Since his return to the White House, President Donald Trump has imposed tariffs on Chinese goods. China’s move could be aimed at making its exports more competitive by keeping the currency weaker.

* Additionally, the 7.2 yuan-per-dollar level has long been a key psychological barrier. In the past, the central bank has stepped in when market forces pushed beyond that level.

* However, this time the bank is stepping back, allowing the yuan to slide past it officially.

* According to the development, some analysts believe this could mark the beginning of Chinese authorities’ broader, managed depreciation strategy. A move that could benefit risk-on assets.

* Historically, when the yuan loses value there is increased interest in moving money out of China. In the past some of that money has flowed into Bitcoin.

* Crypto experts are already noting similarities between today’s situation and events in 2013 and 2015 when a noticeable rise in Bitcoin’s price followed the yuan devaluation.

* In his recent X post, Arthur Hayes, the former CEO of BitMEX, disclosed that if the U.S. Federal Reserve does not take steps that favor Bitcoin, then the PBOC might do so indirectly.

* Past yuan devaluations have supported a narrative of Chinese capital flowing into crypto, especially Bitcoin.

If not the Fed then the PBOC will give us the yachtzee ingredients.

CNY deval = narrative that Chinese capital flight will flow into $BTC.

It worked in 2013 , 2015, and can work in 2025.

Ignore China at your own peril.https://t.co/W6q4G7V8b3

— Arthur Hayes (@CryptoHayes) April 8, 2025

Still, several factors may make this difficult. For instance, China has strict regulations regarding cryptocurrency activity.

According to a new regulation, banks are required to monitor and report suspicious international transactions, especially those linked to crypto.

Analyst Markus Thielen also noted that legal risks for individuals using crypto for capital movement have grown even steeper since August 2024. Despite this, a strong enough economic push could still reach the Bitcoin market.

CoinSpeakesr reports that crypto market liquidations jumped to $1.4 billion after Bitcoin price dropped by 8% earlier this week. BTC price fell to $76,100. However, when writing, CoinMarketCap data shows Bitcoin was trading at $79,117.01, up more than 3% in the last 24 hours.input: A bitcoin chart shows the cryptocurrency trading at around $79 058 on Monday morning. As the world’s largest digital asset could be on the edge of a major price swing. This speculation is growing as China adjusts its monetary policy, a shift that could lead to greater demand for bitcoin and other cryptocurrencies.

As bitcoin and risk-on assets remain susceptible to the monetary policies of top economies like China, the potential positive shift appears imminent.

Yuan Weakens as China Responds to Economic Pressure

The People’s Bank of China (PBOC) has moved to allow the yuan to weaken beyond a significant level. The central bank set the daily reference rate at 7.2038 against the dollar. The update marks the lowest fix since September and signals a change in how the central bank manages the currency.

It is worth noting that the yuan cannot float freely like the US dollar or the euro. It trades within a 2% band on either side of a set rate announced each morning by the central bank.

Many experts opine that this decision is a response to renewed pressure from the United States. Since his return to the White House, President Donald Trump has imposed tariffs on Chinese goods. China’s move could be aimed at making its exports more competitive by keeping the currency weaker.

Additionally, the 7.2 yuan-per-dollar level has long been a key psychological barrier. In the past, the central bank has stepped in when market forces pushed beyond that level. However, this time the bank is stepping back, allowing the yuan to slide past it officially.

According to the development, some analysts believe this could mark the beginning of Chinese authorities’ broader, managed depreciation strategy. A move that