China's newly announced economic stimulus is giving Bitcoin a boost. The more money sloshing around in the global financial system, the better for crypto.
Bitcoin surged after China's central government revealed plans to distribute billions to stimulate economic growth.
China's Finance Ministry said on Thursday it plans to issue $284 billion worth of bonds, the biggest stimulus measure since the Covid-19 pandemic.
Since then, bitcoin is up 5% as loosening economic conditions revive confidence in riskier bets.
The top crypto is trading at around $66,300, its highest price since July.
Bitcoin has surged since China announced measures to boost its economic growth.
China's CSI 300 stock index also rose 15% this week, its best weekly performance since 2020.
Along with the stimulus, China's central bank will reduce the amount of cash banks must hold by 0.5%, injecting more money into the country's economy.
“This is just the beginning; The real bazooka will come when Xi orders banks to issue more credit,” BitMEX co-founder Arthur Hayes said of the recent moves. Blog post.
The news is coming Report The Bureau of Economic Analysis estimates the US economy grew at an annualized rate of 3% in the second quarter, up from 1.6% in the first quarter.
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With the US Federal Reserve Estimated Market conditions have been the best for Bitcoin and other crypto assets in months, with interest rates cut by 0.5% in November.
Liquidity rules
China's mega bond offering aims to revive consumer spending left behind In recent years.
The money is used to pay for subsidies on consumer goods such as appliances and cars, as well as a monthly allowance of about $114 per child for families with two or more children. Reuters reported.
“This move should be positive for crypto prices,” Brian Ruddick, senior strategist at crypto trading firm GSR, said. Said On X.
The more money sloshes around the global financial system, the better for crypto.
Crypto in China
The Chinese government has historically been hostile to crypto, banning most activities involving digital currencies.
However, Chinese investors can buy crypto through Hong Kong-based firms.
In April, three bitcoin exchange-traded funds were launched in Hong Kong. China Asset Management, one of China's largest fund managers, offers the largest $145 million In assets under management.
While the launch of Hong Kong's bitcoin ETFs was highly anticipated, inflows were subdued compared to US spot bitcoin ETFs, which managed some. $60 billion.
Crypto market movers
Bitcoin rose 2.3% today and reached $66,310. Ether is trading at $2,683, up 1.9% in the last 24 hours.
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There is Tim Craig DL News' Edinburgh-based DeFi correspondent. Reach out with tips at [email protected].
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