Cryptocurrencies rose during the Spring Festival holiday

Source: China Times

Author: Ran Xuedong An Lingfei

Abstract: In sharp contrast to the bleakness of the A-share market, the digital currency market has ushered in the Spring Festival holiday, with a market value increase of 34% in the past seven days. Among them, Bitcoin China ’s Spring Festival holiday rose 13%. The digital currency market has received attention again.

China Times (www.chinatimes.net.cn) reporter Ran Xuedong trainee reporter An Lingfei Beijing reports

On February 3, the first day of the opening of the A-share market after the Spring Festival, although the central bank announced a day in advance of the 1.2 trillion yuan in open market reverse repo operations. However, as many investors expected, affected by the coronavirus epidemic, A shares fell sharply after the market opened. As of the close, the Shanghai Stock Index fell 7.72%, and the Shenzhen Stock Exchange Index fell 8.45%.

In sharp contrast to the bleakness of the A-share market, the digital currency market has ushered in the Spring Festival holiday, and the market value has increased by 34% in the past seven days. Among them, Bitcoin China ’s Spring Festival holiday rose by 13%. The digital currency market has received attention again.

Digital currency's market value has risen by 34% in the past seven days

January 24, 2020 to January 30, 2020 is the Chinese New Year holiday. Affected by the coronavirus epidemic, the State Council has extended the Spring Festival holiday to February 2, and work normally from February 3.

Because the Chinese New Year holiday was closed, A-shares ushered in the first trading day after the outbreak on February 3. The Shanghai Composite Index opened 9.13% lower. At the close of the morning, more than 3,000 stocks in the two cities fell to a limit, setting a record for A-shares. Down record.

This decline is a foretaste. Affected by the epidemic, the Hong Kong stock market that opened earlier, the first trading day after the Lunar New Year, the HSI fell by 2.62%, and the next day by 0.52%.

Unlike the stock market's opening and closing, the digital currency market presents a 7 * 24-hour trading model. During the Lunar New Year, it shows a general upward trend. According to the market trend of non-small platforms, the total market value of digital currencies has increased by 34% in the past seven days, with a total market value of 282.8 billion US dollars.

Specifically, the reporter calculated the price changes of some digital currencies during the Spring Festival holiday through non-small platforms. The price of Bitcoin with the highest market value soared from $ 8,370 on January 24 to the highest $ 9,470 on February 2, an increase of 13%. , With a market value of 171.3 billion U.S. dollars. Ethereum rose from an opening of $ 163.37 on January 24 to a maximum of $ 193.09 on February 2, an increase of 18%. Litecoin rose from an opening of $ 55.5 on January 24 to an opening of $ 73.2 on February 2, an increase of 31.9%. Yuzu coin rose from the opening of 3.56 US dollars on January 24 to a maximum of 4.3 US dollars on February 2, an increase of 17%.

Binance CEO Zhao Changpeng recently publicly expressed his optimism on the market on Twitter. "It's time to unfollow those who predicted that Bitcoin will fall to $ 5,000, including those who predicted Bitcoin would fall to $ 1,000 a year ago."

There are opinions in the market that due to the impact of the new coronavirus, the stock market has fallen, and digital currencies such as Bitcoin and gold have become the safe haven of choice for investors, which has also become a catalyst for the rise of Bitcoin. Foreign media Coinspeaker reports that the current medical emergency has caused bitcoin prices to rise, and this problem has spread all over the world, and many investors use bitcoin as a haven.

A report released by the BlockVC Strategy Research states that as the uncertainty brought about by the US-Iraq conflict and the Chinese epidemic continues to rise, investors generally lower their expectations for economic growth and asset price performance in the spring of 2020. A pricing response has been given, and the actual interest rate has started to fall, which has driven the rise in the price of gold. It has also supported the price of bitcoin to some extent, but I am afraid that it will suppress speculative sentiment.

However, veterans of the currency industry told reporters that the epidemic caused delays in holidays and delayed opening of the stock market. Many people are concerned about the 7 * 24 digital currency market. Although the epidemic brought a certain degree of market response, it did not cause the digital currency to rise. The most important factor.

Halving the market and Brexit

In fact, 2019 is the most difficult year for digital currency market. The price of bitcoin dropped to around $ 3,000 in early 2019, after which it rebounded to $ 14,000. It is worth noting that due to the favorable policies in October this year, the price of bitcoin rose rapidly from around $ 7,500 and rose to a stage high of $ 10,021 on October 26. Since then, the price of bitcoin has again declined in November, and once It dropped to around $ 6,600.

Since entering 2020, many digital currencies have shown an upward trend. Bitcoin, Ethereum, and Ethereum Classic all start in the year and a half of 2020, and the increase has reached 20%, 23%, and 64%, respectively. Sun Yuchen ’s TRON coin also rose 22%.

The above-mentioned currency circle veterans believe that the most important reason for this rise is the halving of the market in 2020. According to the past Bitcoin halving experience, the months before the halving will slowly rise, and after a half halving, it will start to soar.

The so-called halving of Bitcoin means that in the Bitcoin white paper released by Satoshi Nakamoto, the total number of Bitcoins was set to 21 million. In order that the Bitcoin system will not generate inflation and ensure the scarcity of Bitcoin, Satoshi Nakamoto The only output method designed for Bitcoin is mining. At the same time, for every 210,000 blocks, the Bitcoin reward produced by a single block will be reduced to half of the previous cycle. Based on the average block production time of ten minutes, the output of Bitcoin will be halved about every four years.

Similar to Bitcoin, other currencies will halve or reduce production after completing certain blocks. Judging from the halving arrangements of various currencies in 2020, Ether Classic's production was cut in March this year; BCH was halved and BSV halved in April this year; Bitcoin was halved in May this year; DASH was cut in May this year; ZEC was cut in October .

The report released by the BlockVC strategy research also mentioned that the market started earlier than expected and it is likely that the pace is relatively slow. Bitcoin is currently in a good uptrend. For Bitcoin, the halving market has just Warm-up, far from entering the climax, the overall rhythm in February is still a period of slow thermal expansion, and Bitcoin will continue to maintain a rising upward trend at the bottom.

The Coinspeaker report also mentioned that Bitcoin halving was one of the reasons for the rise in Bitcoin prices during the Spring Festival. Based on previous years' experience, the price of Bitcoin will increase as it halves. On the other hand, Brexit concerns have also led to higher prices. Britain has withdrawn from the European Union, but the agreement has not yet been reached. As the negotiations continue, the outside world has doubts about the development of the two sides.

February 1st is the first day of Britain's formal withdrawal from the European Union, and it will also begin an 11-month transitional period. Britain and Europe need to complete negotiations and end legislation on new trade relations, defense cooperation, immigration and border control issues. Despite the "orderly Brexit" of the United Kingdom, the European financial order may still be reshaped, and opportunities will emerge for digital tokens and the blockchain economy.

Huijin.com quoted analyst Tarron as saying that Brexit may have a positive impact on the bitcoin and cryptocurrency markets. Although Brexit plans have caused heavy damage to the euro and sterling, most analysts predict that the cryptocurrency ’s Value will remain stable or even increase.