Despite the ongoing bullish upsurge still being in its nascent phase, the crypto segment has already gone through AI-, LSD- and ZK-centric manias. Should we now brace ourselves for the fourth "narrative" in three months?
Two main catalysts of upcoming "Chinese Coins" euphoria
In recent days, more and more experts on Crypto Twitter are forecasting a "Chinese Coins Pump" to be incoming. Mostly, it is attributed to the regulatory easements in Hong Kong and the prospects of "quantitative easing" in China.
The China easing narrative is not some imaginary garbage— Crypto熊猫 (@NoodleofBinance) February 18, 2023
Look at the liquidity injections China is ramping up in Feb - most recent 835B CNY via reverse repurchase
Monie printer goes brrrr from the EAST
oh, sorry US inflation, China exporting moar pic.twitter.com/LMmNLP1xHQ
It was noticed that massive liquidity injections by People's Bank of China (PBoC) coincided with the upsurge in crypto markets capitalization. Also, the announcement of the licensing regime for Virtual Asset Service Providers (VASP) in Hong Kong (that might be activated as soon as June 1, 2023) attracted public interest to "Chinese Cryptos."
However, both catalysts should not be overestimated: the actual size of "money printing" is yet to be seen, while the Hong Kong licensing will not affect retail buyers directly. Also, the very concept of "Chinese" coin looks too vague. However, people do not want to miss the mini-rally and are actively seeking opportunities to benefit from it.
China Coin Narrative is here. Some of my favorites— Andrew Kang (@Rewkang) February 17, 2023
- $FIL (恭喜FIL財)
- $KLAY (actually Korean, but it might get confused)
- $BNB (People always mistake CZ for Chinese Citizen)
- $ETH (Vitalik has had multiple Chinese GFs)
Mechanism Capital's Andrew Kang indicated some tokens that might fit into this narrative. Also, the core utility cryptocurrencies of Asia-focused centralized exchanges — Huobi Token (HT), KuCoin Token (KCS), Gate Token (GT) and OKX Token (OKB) are in focus today.
It should be noted that the first pumps of this euphoria have already happened. "Chinese Polygon" CoinFlux (CFX) rallied by 140% in a few days, while OKB jumped to a new all-time high following the OKBChain launch announcement.
Chinese Ponzi stays in top of Polygon (MATIC) gas consumers
At this phase, the "China Coins" narrative looks highly speculative. With a certain irony, some DeFi experts are already guessing about the ways projects would be ready to "reinvent" their coins as "Chinese":
We are about 2-3 days away from Westerners fighting each other about which names are more Chinese than others
At the same time, the story of Chinese Ponzi Avatar that spends more Polygon (MATIC) gas than all Binance (BNB) wallets on this network, is very far from ending.
Despite the fact that Avatar was dethroned by crypto game Planet IX — its two modules combined consume 2.65% of all Polygon (MATIC) gas — the China-centric MLM refuses to leave the top 10 most active Polygon (MATIC) dApps.