Bitcoin prices jumped sharply today, rising upwards of 40% after Chinese President Xi Jinping said the country should “seize the opportunity” afforded by blockchain technology.
The world’s most famous digital currency reached as much as $10,332.41 around 9:45 EDT. This is after bitcoin suffered some notable losses this week, dropping to its lowest since May of 2019.
A turning point
“Leading up to Mark Zuckerberg's Libra hearing, bitcoin had sold-off as many traders put on bearish positions,” said Todaro.
“The technical set up looked negative, but then President Xi Jinping's commentary around blockchain technology was an unexpected positive catalyst that caught some bearish traders off guard in my view, leading to the upward movement which likely brought in more speculators as BTC traded above key thresholds,” he added.
Although China’s central bank ordered mainland-based coin exchanges to close in 2017, Xi’s comments are good for sentiment around the crypto industry, Mati Greenspan, senior market analyst at exchange eToro told CoinDesk.
“It’s bullish for the entire crypto industry, in general, when you have the leader of one of the world’s largest economies coming to embrace blockchain technology like this,” Greenspan said. “Bitcoin, as we know, is a central player in the blockchain industry.”
The comments on blockchain are believed to be the Chinese president's first in-depth remarks on the technology. Meanwhile, the nation is developing a digital version of the country’s own currency.
Greenspan remarked that the price rise appeared to be directly correlated with the leader’s statements.
“It seems like this is what investors were reacting to,” Greenspan said. “There’s only so much amount of good news that can be ignored. Xi is one of the most important people in the world.”