Analysis

Why The Crypto Downtrend Could End On New Year’s Eve

Is the China ban guilty for the current Bitcoin sell-offs that introduced down the entire crypto market? That is the prevalent principle. As the primary exchanges shut their operations in mainland China, the residents have been fearfully promoting their belongings. They don’t know in the event that they’re going to have the ability to transact and even promote their cryptocurrencies sooner or later, in order that they’re going again to the Yuan. And we’ve got charts from Arcane Research and a carrot to show that. 

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Let’s cease losing time and go to the laborious information.

How’s The China Ban Treating Huobi?

The headline, provided by this carrot, is the next. “Asia’s largest exchange, Huobi, has stopped related trading in China. Bitcoin has been flowing from Asia to the US and Europe for some time.” To elaborate on that, we convey out good mates at Arcane Research’s The Weekly Update. “The final impact of the Chinese bitcoin ban from September is unfolding. After gradually removing Chinese mainland users, Huobi’s share of the global open interest has fallen to 2%, down from its Feb 15th, 2020 peak of 20%.”

And they’ve the charts to show it:

Open Interest Huobi and OKEx - Arcane Research

BTC Futures Open Interest, OKEx and Huobi | Source: The Weekly Update

And much more information and essential dates:

“Huobi has accelerated its retirement of Chinese mainland customers. On Sept 24th, Huobi ceased registrations for new mainland Chinese customers. On Dec 15th, Huobi ceased spot trading for Chinese citizens. Additionally, from Dec 15th to Dec 31st, Chinese mainland customers are only able to sell digital assets.”

So, the crypto downtrend might finish on New Year’s Eve as a result of it’s the final day that Huobi’s “Chinese mainland customers” will have the ability to promote. This would possibly sound like an exaggeration, however take a look at this bloody purple chart:

“The sell-pressure from China is real,” and it isn’t solely coming from Huobi.

How’s The China Ban Treating OKEx?

The different Chinese big’s state of affairs is extra complicated. What’s occurring in there? How are they dealing with the China ban? Rumors are flying. According to the carrot, “The ok exchange has not yet issued an announcement on the clearing.” The Weekly Update has a bit extra data, but it surely’s nonetheless convoluted. 

“The public statements from OKEx are far more ambiguous than those of Huobi. The exchange has publicly stated that the exchange website will be inaccessible for mainland Chinese traders. Further, the exchange has stated that it will not set up offices and teams in mainland China while maintaining the policy of “exiting the Chinese mainland market.” In OKEx’s subreddit, the OKEx helpdesk shared a screenshot from its P2P market, at the moment permitting merchants to commerce utilizing the Chinese Yuan.”

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As the primary graph exhibits, OKEx open curiosity share can be in sharp decline. “In April 2020, OKEx accounted for 30% of the open interest in the futures market, in stark contrast to today’s 8% market share.” The sign is obvious, even when the state of affairs isn’t.

BTCUSD price chart for 12/22/2021 - TradingView

BTC price chart for 12/22/2021 on Coinbase | Source: BTC/USD on TradingView.com

What About Binance?

Sadly, we don’t have as a lot information about them. The carrot claims that “Binance will be partially cleared at the end of the year.” It additionally informs us that “Binance’s net position change recently red (likely because of China),” and provides us two very informative charts. In them, the sell-pressure that the China ban generated is clear. While Binance is purple, the US and Europe-centric Kraken could be very a lot within the inexperienced.

So, is the crypto downtrend going to finish on New Year’s Eve? The information speaks for itself. Let’s cross our fingers, nonetheless.

Featured Image: Myriams on Pixabay | Charts by TradingView

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