• Although China has banned Bitcoin and other digital assets, local financial institutions have begun investing in crypto startups in Hong Kong.

• The adoption of Bitcoin in China with more than 1.4 billion people could trigger a massive bull rally.

As China pushes its quest for higher adoption of the Yuan as a global reserve currency, the Chinese Communist Party has slowly been shifting focus on Bitcoin and the rest of the crypto market. Already, Chinese financial institutions are investing in crypto startups through Hong Kong, which is about to enact crypto-friendly policies.

Furthermore, the Chinese government understands there is a huge demand for crypto products among mainland residents, who have reportedly been using VPNs to access Binance and other off-shore exchanges.

China Media Goes Pro-Crypto

In the latest developments, Binance CEO Changpeng Zhao (CZ) noted that China Central Television (CCTV), a national television broadcaster that reports directly to the Chinese Communist Party, just began broadcasting crypto. Notably, China Central Television has a view base of more than 1 billion through six languages. As a result, CZ noted that such a move is extremely bullish for Bitcoin, which could trigger a massive bull rally.

This comes as the crypto market faced increased bearish short-term sentiment. According to the latest crypto market data, the total crypto market capitalization dropped approximately 1.7 percent in the past 24 hours to about $1.10 trillion. The drop was mostly due to increased fear as Bitcoin dropped below $26k again on Wednesday.

However, Chinese reporter Wu Blockchain noted that CCTV removed the video of crypto assets after the tweet by CZ.

Sour History

China has over the years been known for its strict policies against the crypto market despite the largest exchange, Binance, having roots in the region. For instance, the People’s Bank of China issued a crypto ban in 2019, indicating that it would block access to all domestic and foreign cryptocurrency exchanges and Initial Coin Offering (ICO) websites.

The Chinese government has previously cited the crypto market as a huge threat to the success of its financial stability. Furthermore, famous Chinese social media platforms including WeChat had begun offering digital assets related services before the government intervened through the digital Yaun.

However, as the relationship between the United States and China gets soar amid the escalation of Russia’s invasion of Ukraine, the Xi Jinping government has begun welcoming back digital assets. Moreover, the Kremlin has previously stated that Bitcoin can be used in the settlement of crude oil trades amid sanctions from western countries.

Bitcoin Market Outlook

The Bitcoin market has been correcting in the past two months after the March breakout, which was fueled by the collapse of three regional banks in the United States and the bailout from the Fed. Trading around $26.2k on Thursday, Bitcoin price faces more downward sell pressure towards $24k. The Bitcoin downward trend comes despite the increased risk in the market equities associated with the ongoing debt ceiling debate in the United States. 

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