Could China Drive the Next Bitcoin and Gold Rally? Analysts Are Optimistic About the Chinese Economy

The potential outlook for China’s economy and speculation about quantitative easing (QE) in its real estate sector might influence the prices and liquidity of Bitcoin and gold in the coming months.

Dan Tapiero, founder and CEO of 10T Holdings, suggests that a substantial accumulation of capital in the Chinese market may be imminent. Reflecting on the Chinese real estate downturn a few years ago, with Evergrande at the center of attention, it was eventually bailed out by the government.

Now, the Chinese government is reportedly considering QE measures to encourage borrowing among real estate companies. In the long term, QE is a situational economic measure that could provide more funds to liquidity-strapped Chinese real estate developers.

The advantage of this measure lies in its ability to kickstart businesses. However, it could also exert pressure on the fiat currency due to the potential capital release. Economic liquidity overflow might directly lead to a depreciation of the yuan.

Tapiero believes this move would be “extremely beneficial for global liquidity.” If this happens, it could serve as a catalyst for Bitcoin and other assets viewed as inflation hedges, such as gold.

He highlights that “after more than a decade of a prolonged bear market, the explosive rise of Chinese real estate stocks” translates into a lot of pain. According to Tapiero, silver, Ethereum, and even the Nasdaq might not be excluded from the potential boost.

The consideration of Bitcoin as an inflation hedge is gaining traction across different economies. The U.S. Consumer Price Index (CPI), released by the Labor Department two days ago, has reignited this discussion, now extending to China’s real estate QE.

Bitcoin is currently priced at $67,041, up 0.88% in the past 24 hours. Speculation suggests that the sudden increase in interest in this token could spark potential activity within the flagship cryptocurrency ecosystem, potentially pushing its price to new levels.

However, the potential resistance due to unpredictable market fluctuations should not be underestimated.