While China has not welcomed cryptocurrencies very much since it enacted a blanket ban on digital assets in late 2021, certain Chinese cryptos experienced a significant rally in February this year. While the country’s central bank is currently pushing for a faster recovery from the pandemic-induced slump, a similar rally may take shape in the coming days.
Central Bank urges recovery efforts
The People’s Bank of China (PBOC) announced on Friday that for the first time this year it will reduce the amount of cash banks are required to hold as reserves — known as the bank’s reserve ratio. The purpose of this move is to help maintain adequate liquidity and support an emerging economic recovery.
Read more: Why is Bitcoin price rising?
The central bank announced that it would cut the reserve requirement ratio (RRR) for all banks by 25 basis points (bps) from 27 March. However, this reduction does not apply to banks that have already adopted a reserve ratio of 5%.
China’s Changing Attitudes Towards Crypto
Despite the open assumption that China has an anti-crypto stance, recent developments indicate otherwise. It seems China Liaison Office officials are interested in Hong Kong’s progress with cryptocurrency. These officials are reportedly studying the country’s approach to digital assets, which many believe is a net positive for the industry.
However, this trend is not limited to governments alone; private companies in mainland China are also exploring Web3 technologies and the use of crypto. For example, China Telecom has partnered with major crypto companies to develop SIM cards based on blockchain technology.
The culmination of all these reasons, in addition to the constructive measures taken by the central bank to support a faster recovery, help develop a positive attitude towards the cryptos that fall under the “China story.”
Chinese crypto coins to collect
Several of the most well-known Chinese cryptocurrencies have already seen their prices rise significantly in recent months, with Conflux rising by almost 124% in the past seven days.
NEO, another prominent Chinese Layer-1 blockchain, could see incremental gains in the coming days as the Chinese narrative intensifies. The price of NEO has risen significantly today as it is currently trading near the $12 level with a market cap of around $844 million.
VeChain, IOST, Polkadot and Filecoin are some of the other famous Chinese crypto coins that may increase in value in the coming days. And to add more positive momentum to the rally, Bitcoin’s price is already tearing through the coveted $26,000 mark, resulting in favorable sentiment in the overall crypto market.
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Pratik has been a crypto evangelist since 2016 and has experienced almost everything crypto has to offer. Be it the ICO boom, the bear markets of 2018, Bitcoin’s halving so far – he’s seen it all.
The content presented may contain the personal opinion of the author and is subject to market conditions. Do your market research before investing in cryptocurrencies. The author or publication is not responsible for your personal financial loss.
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