Is China about to trigger a Bitcoin price crash 2.0?
China could inadvertently spark a Bitcoin (BTC) price crash as reports emerge that local governments are offloading their stash of seized assets despite a nationwide cryptocurrency trading ban. If these sales accelerate, the market could face a flood of supply, triggering volatility and potentially a price drop reminiscent of the 2021 crash that followed China’s cryptocurrency trading ban. Simply put, dumping large quantities of Bitcoin onto the market could create a supply influx, overwhelming demand, and driving prices down. China ranks as the world’s second-largest Bitcoin holder after the United States, with approximately 194,000 BTC, valued at $16 billion. On the other hand, by the end of 2023, local governments reportedly held around 15,000 BTC, worth $1.4 billion, accumulated through criminal seizures. Now, these assets are being sold through private firms, some of which have facilitated billions in sales since 2018, with proceeds converted to yuan ...