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Chinese cash to boost Bitcoin?
Bitcoins / Breaking News

Chinese cash to boost Bitcoin?

In an effort to raise market sentiment, China has injected more than 810 billion Chinese yuan (approx. $130 billion) into its economy over a five day period. This move is intended to solidify the country's economy and give a boost to the national supply, but they may actually have just done their greatest enemy a favour. The Chinese government controversially banned Bitcoin exchanges and ICOs in September. Since then, it has been preoccupied with working to keep capital within Chinese borders. Consequently, the quashing of Bitcoin and other cryptocurrencies has been seen as a prudent measure. However, this killing blow from financial regulators has not been able to completely erase the cryptomarket in the Asian country. And this new cash injection might actually be beneficial to the ravenous Bitcoin investors that still exist in China. Trickling down The extra cash was raised through repurchase deals. This means the Central Bank buys securities in transactions with commercial banks with the agreement to sell them again at some point in the future. The capital now floats around in the economy, and a portion of it will undoubtedly find its way into the Bitcoin revenue stream. Since Bitcoin is still alive in China, in a black market-style underground, the demand endures while the public seeks out new and innovative means to acquire cryptocurrency. So it seems the Chinese government might be shooting itself in the foot, as this latest move will have a trickle-down effect, whereby more capital will find its way into cryptocurrency. From here, much of that extra liquidity could move out of the country unregulated, despite the efforts of the regulators. Bitcoin Survives The banning of cryptocurrencies hasn't killed them off in the socialist republic. Local Bitcoin has grown steadily since the ban, allowing the market to endure, albeit in a different guise.

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