Bitcoin has taken a rather bad turn in terms of value these past few weeks, with the BTC going under the $8 000 mark this weekend.
It’s a stark example of how volatile the coin is, but in places like Argentina and China, the sheer volume of trading caused a premium to rise within these specific sectors.
This could be demonstrated by how CoinMarketCap had a mean $100 over most other exchange platforms.
Bitforex, a Hong Kong based exchange, reported a premium of $450. Even China is gaining from this premium, with their exchange Huobi showing their BTC low being $7869, compared to Binance’s $7785
Bitcoin trading in Hong Kong has reached an all-time high in terms of volume, clocking in over $12 million in one week.
The massive uptake in purchases is a result of the political turmoil of Hong Kong. That, and the rhetoric that’s been given out that Bitcoin is considered a “Safe Haven,” just like assets such as gold.
The Safe Haven rhetoric was disproved when strategists speculated that the US economy has a high chance of going into recession next year.
Gold, not Bitcoin, rose up in sales because of it. Before this, Bitcoin was touted as the future’s safe haven. It still is but to a lesser degree.
It could be the fact that, in the end, gold is a tangible thing. A thing that you can touch that will make it stay as the go-to haven asset.
Bitcoin is a very lucrative way to make money if you buy low and sell, high, but will always be a thing you can’t touch.
A similar premium happened in Argentina in light of political turmoil there. However, due to the more advanced bitcoin infrastructure with Hong Kong, Argentina has taken a worse hit, all in all.
Political Turmoil in Hong Kong
Hong Kong’s citizens are turning to Bitcoin as a haven asset due to how the country has practically been paralyzed with its widespread protests.
It all started when Hong Kong passed a bill that allowed people to be tried within mainland China. However, the movement has gained incredible momentum and has developed into a full political movement.
Hong Kong is, officially speaking, a self-governed nation under China’s control. However, due to the way Beijing picks the country’s leader, China has slowly tried to move into the country and gain more power.
Hong Kong’s independence streak has made that a less-than-smooth operation.
It wasn’t helped with the country’s Chief Executive, Carrie Lam, enacting emergency powers that essentially turned Lam into an autocrat.
The latest of these turmoils would be the blanket ban Hong Kong has rolled out on masks, in an attempt to quell the protests by making them unable to hide their identity.
This was met with extreme resistance instead of complacency, with more and more people joining protests.
While initially peaceful, the demonstrations went violent when police forces tried to disperse them with tear gas forcibly.
Two people have already been arrested and are being tried for illegally wearing a mask. However, the law achieved nothing since the trend goes on.
The people are entirely against Lam at this point, and Lam’s solutions are only alienating the people more.
The situation will probably reach a breaking point before long unless Lam radically changes their ideology with how to approach the protests.