China: Crisis and strengthening of the dollar, what consequences for bitcoin (BTC)?

Focus on the complex relationship between bitcoin (BTC) and China. The most populous country in the world is greatly improved by recent changes in the international financial situation. The euro has fallen, the dollar is strengthening. Meanwhile, Chinese banks face insolvency risks with widespread mortgage boycotts. So many things that could well make assess the relationship between digital gold and the factory of the world.

The economic situation in China

Currently, 28 of the top 100 real estate developers have defaulted or restructured their debts. There is a growing “mortgage boycott”, where buyers of unincorporated homes considered due to the pandemic, the financial situation of developers and the country’s zero-COVID policy, have refused to pay their mortgages. The boycott started with 20 projects and has since expanded to 235 projects. Chinese banks have $9 trillion in real estate exposure. If there were a problem with the perpetual decline in house prices, it could very quickly cause a solvency problem for the banks.

The US dollar and bitcoin (BTC)

While a major financial crisis could break out in China, the dollar has strengthened. Many expect to see repercussions in bitcoin (BTC). Indeed, some justify that the rise in the price of BTC coincides with a weak dollar. For others, the rise of the dollar is not synonymous with a possible fall of BTC. It’s important to note that bitcoin and the dollar have both moved over the past 10 years, only on slightly different timelines.

The world situation does not bode well. A financial crisis major in China could lead to a global collapse, much like with the subprime mortgage crisis. A collapse that would involve continuing the bitcoins. Meanwhile, BTC has rallied to just over $23,000. For the moment, the “king of cryptos” has kept his head above water.

Receive a digest of news in the world of cryptocurrencies by subscribing to our new daily and weekly newsletter service so you don’t miss any of the essential Cointribune!

Avatar Gregoire Morat

Gregory Morat

Student passionate about entrepreneurship and fascinated by the technologies behind cryptos! Yes, I am convinced that the two are intimately linked: blockchain and NFTs are revolutionizing many sectors and presenting unprecedented opportunities.

Leave a Comment