China State Media Issues Alert on Crypto Risks Amid Bitcoin Rally
China’s state-run media has once more cautioned investors against crypto investments as Bitcoin reached a two-year peak on Monday, near the $64,000 mark.
State-owned newspaper Economic Daily pointed out on Sunday that Bitcoin’s price rebound doesn’t mask the underlying risks associated with the digital asset.
“Investors should remain cautious about the risks associated with Bitcoin and products whose value is tied to cryptocurrencies,” it said.
The newspaper cited Beijing-based lawyer Xiao Sa, who noted the recent approval of Bitcoin Spot ETFs in the US. This approval has reduced the entry barrier for overseas investors and boosted market trading activity, he said.
He further emphasized that overseas Bitcoin ETF dealers cannot sell related financial products to Chinese citizens. Additionally, residents of mainland China are prohibited from directly purchasing related financial products using tools.
The article also quoted Zhao Wei, a senior researcher at OKX, who highlighted other concerns in the crypto market. These include rising macroeconomic uncertainty, the presence of unforeseen industry events, and unclear regulatory policies.
The warning comes as Bitcoin has shot up by 50% this year, with much of the spike happening in the past few weeks, on the back of trading volume for US-listed bitcoin funds seeing a big jump. Last week, Bitcoin became a hot topic on various Chinese online platforms, like the microblogging site Weibo.
Chinese state media has persistently tried to caution against crypto involvement, citing concerns over capital flight and financial instability.
In Sept. 2021, the Chinese government took a significant step to ban cryptocurrencies by involving 10 different agencies. They declared various crypto-related
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