The Rise of Bitcoin in Asia
Asian Investors Driving Bitcoin’s Meteoric Rise
Bitcoin’s recent surge is fueled by Asian investors, particularly those in South Korea and China. Data from The Block shows that Asia accounted for a significant portion of bitcoin trading volumes, with a substantial $791 billion traded in February alone.
China, in particular, has seen a surge in interest in bitcoin, with many small investors turning to the cryptocurrency amid a lackluster stock market. Searches for “bitcoin” on popular messaging app WeChat spiked significantly in February, indicating growing FOMO among Chinese investors.
Bitcoin’s Soaring Prices and Market Dynamics
Bitcoin is currently trading close to its all-time high of $69,000, experiencing a remarkable 148% increase since October. This surge is primarily attributed to the approval of spot bitcoin exchange-traded funds (ETFs) by U.S. regulators, with BlackRock’s iShares bitcoin trust benefitting from increased investment flows.
Additionally, traders are flocking to bitcoin in anticipation of the upcoming “halving” event in April, which could impact supply and drive prices higher. With a limited supply of 21 million bitcoins, scarcity is a key factor driving investor interest.
Regulatory Landscape and Market Behavior in Asia
The legal framework for bitcoin varies across Asian countries, from relatively liberal regulations in Japan to a complete ban in China. While spot bitcoin ETFs are prohibited in South Korea, local brokers facilitate access to bitcoin futures ETFs, contributing to the cryptocurrency’s popularity in the region.
In South Korea, bitcoin trading volumes have surged, with platforms like Upbit witnessing a significant increase in activity. Despite this, U.S.-based exchanges continue to dominate global trading volumes, maintaining a 50% market share.
Bitcoin’s Growing Popularity in India
India has also seen a rise in bitcoin trading, with several local exchanges operating legally. However, a significant portion of trading occurs on offshore platforms like Binance and KuCoin, where the absence of a 1% transaction monitoring tax attracts Indian investors.
Between July 2022 and July 2023, Indians traded crypto worth 350,000 crore rupees via offshore platforms, highlighting the substantial interest in bitcoin within the country.
