This comes on the heels of the strong performance of the recently launched Bitcoin and Ethereum ETFs in Hong Kong, leading some to believe that the central government is now re-evaluating its overall position on cryptocurrencies.
Rumors have been swirling about China's potential role in creating a Bitcoin reserve, sparking interest in the cryptocurrency market. While China's relationship with cryptocurrency has always been complex, recent developments suggest the country may soon play a larger role in Bitcoin's future.
speculations suggest that closed-door meetings are being held in China to discuss the creation of a Bitcoin reserve. This speculation follows the strong performance of the recently launched Bitcoin and Ethereum ETFs in Hong Kong, which some believe has led the central government to re-evaluate its overall position on cryptocurrencies.
Hashkey's CEO, Chao Deng, touched upon this possibility in an interview with CNBC. He stated, "I think there is the possibility that the mainland China government will reconsider their stance towards the crypto and Web3 industry. From what I know so far, our conversations with mainland professionals and related sources suggest they are now looking at the market and seeing what's happening in other countries, what's going on in Web3 industries, and they may come up with their response towards this industry."
China's potential shift in its crypto policy also coincides with a broader technological transformation within the country. The government has recently placed a strong emphasis on integrating blockchain technology into key sectors of its economy, including the automotive and technology industries, which is expected to further fuel this re-evaluation of cryptocurrencies.
This development is particularly relevant as experts are divided on whether Bitcoin will continue its rally to hit the $100,000 milestone, or if it will see a correction back to the $75,000 level. Those who predict a surge to $100,000 cite positive news out of China regarding cryptocurrency and the increasing demand from institutional investors as key drivers.
Bitcoin has managed to break out of a two-week trading range and is now aiming to pierce through the $90,000 mark, setting the stage for a potential rally to the $100,000 level. However, if Bitcoin experiences a setback and falls below the $80,000 support, it could trigger a further decline to the $75,000 support level.
Given that China holds the title of the world's second-largest economy, any significant move by the country to embrace cryptocurrency would have massive implications on a global scale. If China officially integrates cryptocurrency and Web3 technologies into its financial systems, it could be a game-changing event for the market, potentially leading to a substantial price surge for Bitcoin and other digital assets.
Should Bitcoin continue its current upward momentum, it could pave the way for even greater gains, potentially pushing its price to new all-time highs. However, if the bulls lose steam and Bitcoin's price drops below the critical support levels, it could set the stage for a continuation of the bear market, rendering the possibility of Bitcoin reaching $100,000 null and void.
