The Chinese housing crash around Evergrande and Co. is also dragging the crypto market with it. The market update.
Does the crash of the second largest Chinese real estate company, the Evergrande Group, herald a Chinese stock market crash? In any case, the fear of this is currently not only spreading on the Asian stock exchange markets, but also around the world – and Bitcoin and Co. are not leaving their mark on it either. And so the Evergrande price not only fell to its lowest level in eleven years on September 20 and is currently trading at EUR 0.31 – it was still EUR 7.65 in April.
The Bitcoin exchange rate (BTC) reached a daily high of 47,310 US dollars yesterday, Monday, and is at 42,940 US dollars at the time of writing – 6.26 percent in the red. And it looks similar with almost all crypto courses in the top 100. For example, Ethereum (ETH) lost 4.86 percent on a daily basis, Cardano (ADA) 2.71, Binance Coin (BNB) 6.72 and XRP 4.35 percent. In addition, not a single cryptocurrency can win in the top 50. Only in 63rd place did Celo record a daily plus of 16.91 percent.
Stock market crash triggers stablecoin escape
The impending insolvency of the Evergrande Group, which is in the chalk with more than 300 billion US dollars, is causing panic in the financial markets. It is feared that a Lehman Brothers kind of domino effect could be triggered if the real estate company fails to make its interest payments this week. There is speculation about whether the Chinese government will burst the real estate bubble or step in as a creditor. In any case, the crypto market immediately feels such crises in the traditional financial markets. For many investors, Bitcoin and Co. are still considered risk assets that are sold off in turbulent market phases and used as a quick “cash source”.
That the crypto market is in the red, stablecoins like Tether (USDT), USD Coin (USDC) or Binance However, turning USD (BUSD) into positive territory at the hour indicates a large-scale capital shift. The cryptocurrencies linked 1: 1 to Fiat are usually not subject to fluctuations in exchange rates – that is what their function is after all. The volatility indicates that the stablecoin money printing machine is currently running at full speed. The net flow of the USD Coin reached a three-month high today, like the on-chain data portal Glassnode via Twitter writes.
In the crypto market, the coming trading days could be wildly. Sales on the one hand and repeat purchases by bargain hunters on the other are likely to cause high volatility. Whether the storm is passing the stock markets or the Evergrande Group triggers a chain reaction on the scale of Lehman should have an immediate impact on the crypto market.