This news has been around since mid-February and created a wave of growth in the market at the time, also known as the term “Chinese Pump”.
And as we get closer and closer to June 1, the day when Hong Kong officially legalizes cryptocurrencies, it looks like the wave is making a comeback.
Legalization of Cryptocurrencies
Hong Kong citizens will be allowed to buy, sell and trade crypto assets from June 1. Current rules on cryptocurrency trading also apply to professional investors – individuals with a portfolio of at least HK$8 million.
Besides, the Hong Kong government also started to deploy its own CBDC – e-HKD.
New wave to the market
This is also relatively easy to understand at the present time. Once a new regulatory framework is formed, a certain amount of capital will move from the traditional financial market into the Crypto market.
These sources of funds include:
- Capital of retail investors (massive)
- Capital of institutional investors in Hong Kong
- Indirect capital of foreign investors via Hong Kong
- Public capital
It can be seen that the market reacted relatively positively as it got closer to June 1.
The coins which are related to China have good intraday rallies. Eg
- $PHB: 54%
- $COCOS: 35%
- $CFX: 30%
- $MASK: 22%
and there is an additional $XRP with the news of supporting the HK government in the implementation of e-HKD also showing a relative increase.