Key Points
- Chinese stocks’ rally has slowed down, potentially leading to a shift towards Bitcoin and crypto trading.
- The waning Chinese stock rally could boost Bitcoin, according to Singapore-based crypto trading firm QCP Capital.
Asian stocks have seen a surge since late September due to robust Chinese government stimulus packages and the anticipation of these policies continuing into 2024. However, the rally has started to slow down after a disappointing stimulus package was announced. This has raised hopes of a potential shift towards Bitcoin and crypto trading.
China’s Impact on Crypto Trading
A recent Bloomberg report suggests that the Chinese stock rally may have prompted some crypto investors to shift their capital to these thriving equities. The report cites the relative discount of Tether’s USDT to the U.S dollar (USD) since late September as a significant indicator. With the Chinese equity market rally temporarily slowing down, the question arises whether these investors will shift their focus back to Bitcoin and crypto trading.
According to QCP Capital, a Singapore-based crypto trading firm, the slowing Chinese stock rally could boost Bitcoin. The firm stated that as the Chinese rally wanes, they anticipate capital reallocation back into crypto. However, the firm also pointed out that the upcoming earning season and September US CPI data, scheduled for 10 October, could pose downside risks and potentially complicate the crypto market’s outlook.
Bitcoin’s Current Status
Meanwhile, the BTC Korean Premium Index formed a V-reversal pattern at press time. It was above the neutral level after dropping in the first week of October. This index tracks Bitcoin price differences between South Korean and foreign exchanges. A higher premium suggests a stronger demand for Bitcoin in Korea than overseas. At the time of writing, Bitcoin was valued at $62.5k, down about 1% on the weekly charts.
