Chinese investors push gold to record highs and prepare for Bitcoin ETF launch in Hong Kong

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Last Updated on 25 April 2024 by CryptoTips.eu

Hong Kong is preparing to follow in the footsteps of the US stock exchanges with the introduction of a Bitcoin ETF. Meanwhile, investors from mainland China are driving the gold price to a record thanks to mass buying.

At the time of writing, the largest digital coin is trading for $64,200.

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Gold and geopolitics

Asian and especially Chinese investors see fewer and fewer investment opportunities as of late. The stock exchanges of Shanghai and Beijing have not been doing well for some time now. Chinese real estate is going through a deep slump and the national Chinese currency, the Yuan, is also dropping in value.

It is therefore not surprising that the current record price of gold is mainly driven by investors from Asia.

“Chinese speculators have really grabbed gold by the throat,” said John Reade, chief market strategist at the World Gold Council, an industry body.

“Emerging markets have been the biggest end consumers for decades but they haven’t been able to exert pricing power because of fast money in the west. Now, we are getting to the stage where speculative money in emerging markets can exert pricing power.”

Gold has already risen more than 40 percent since November 2022, supported by record buying by the central banks of countries looking to diversify their reserves against the US dollar, aka mostly emerging economies and China. The spiking interest rates by the Federal Reserve and the ECB also act as a magnet for anyone who invests in gold.

The precious metal, often used as a hedge against inflation and currency devaluation, has continued to rise since the outbreak of the Israel-Gaza conflict in October last year.

Bitcoin ETF

A second interesting fact is that Hong Kong will soon (April 30 is expected to be the official start date) become the first major investment center in Asia to launch its own Bitcoin ETF. It is expected that many mainland Chinese investors (Hong Kong is still seen by many as separate from the rest of China due to its special status) will jump in given the big gains their American counterparts have made since the beginning of this year by buying into such funds.

Hong Kong may not have star power like BlackRock to promote the ETFs, but it should also be able to boost the price of Bitcoin. Of course, the comparison between the (possible) success of the Chinese versus the American Bitcoin ETFs will inevitably be followed by the global media.

Jeroen Kok

Jeroen is one of the lead copywriters on Cryptotips.eu and discusses all recent events in the crypto market. This includes news updates, but also price analyzes and more. He developed his passion for cryptocurrency during the bull run in 2017. He has learned a lot since then. The combination of cryptocurrency and creative writing is perfect for Jeroen and an excellent way to share his knowledge with a wide audience. Find me on LinkedIn / [email protected]
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