The recent slump of China Shanghai Composite index did not result in another rally of bitcoin. Chinese demand for the digital currency is already much above the usual level.
On 11 January Shanghai exchange index dropped below 3000. This caused another wave of panic among mainstream market analysts and provoked some speculations about bitcoin rally on Reddit.
“Now we just need CNY whales to know that there's an alternative called Bitcoin which is not affected at all,” wrote Reddit user smaig.
The crash of Shanghai exchange provoked more than 180 comments from Reddit users and became the second most discussed topic of the day.
Many Reddit users hope to profit from the crash of Chinese exchange, but these expectations do not seem quite realistic. The statistics of the bitcoin-renminbi market suggests the opposite.
According to Bitcoinity, the Chinese market boomed in the end of 2015. From 25 October to 25 November the volume of the bitcoin-renminbi operations tripled from 0.7 million to 2.5 million bitcoins a day. This was one of the key factors behind the bitcoin rally in December.
This year the daily trade volume on the bitcoin-renminbi market was around 2 million bitcoin a day. The constant flow of bad news and dire predictions stimulate the Chinese to buy digital currency. In this situation more bad news is very unlikely to cause another bitcoin surge in China. All this considered, the high hopes of Reddit users seem vain.
Roman Korizky