The Xinhua News Agency, a state-run Chinese media outlet, has recently reported on bitcoin’s price surge above the $10,000 mark this year, and called the flagship cryptocurrency a “safe haven” asset.
As first noted by Chinese cryptocurrency news source cnLedger, the state-run news agency bitcoin’s price increase led to an increase in speculation and short selling as well, meaning more investors are starting to bet against BTC.
1/ Xinhua News (China's official state-run press agency): Bitcoin price continues to maintain momentum after breaking the $10,000 mark, but speculation has increased recently. Analysts believe that bitcoin and other crypto-currencies will have to take time to win market's trust.
— cnLedger (@cnLedger) June 26, 2019
Per the Xinhua News Agency, it’ll take time for bitcoin and other cryptocurrencies to regain the market’s trust after last year’s bear market, which saw BTC drop from a near $20,000 all-time high to a low of $3,200, before recovering.
The Chinese state media outlet claims the escalation of economic and trade disputes, as well as an expected downward adjustment in economic growth and increased market volatility, have seen investors turn to bitcoin. This means bitcoin has been acting as a safe haven.
2/ Global capital market volatility has intensified due to trade disputes & expected down trend of global economy. BTC has shown the safe-haven feature, attracted many investors' attention. FB's Libra also greatly increased crypto popularity leading more users into the market.
— cnLedger (@cnLedger) June 26, 2019
The news outlet added that Facebook’s recently announced cryptocurrency Libra has also increased the cryptocurrency ecosystem’s popularity, helping more investors enter the space. This has also attracted speculators.
The report came out at about the same time Donald Trump’s administration plans on hitting more Chinese goods with tariffs. It’s notable as the Chinese government has, earlier in bitcoin’s history, been dismissive of the cryptocurrency, going as far as cracking down on cryptocurrency trading and initial coin offerings (ICOs).
Earlier this year, as CryptoGlobe reported, a Chinese internet celebrity explained to his followers what bitcoin and blockchain technology are to over half a million viewers. Moreover, a prominent lawyer recently argued that owning and occasionally trading bitcoin in China is legal.
While back in April reports suggests China was planning to ban cryptocurrency mining, the government’s media arm reporting on bitcoin’s rise and claiming it has shown “safe haven asset” characteristics has been seen by some as a change in stance towards the cryptocurrency space.
Xinhua’s article ended by quoting an analyst from Canaccord Genuity, Michael Graham, saying that BTC is has a chance to be widely adopted in the future, that it is now still a growing “grassroots experiment.”
