Bitcoin Little Changed as China Announces Stimulus; Traders Say Harris’ Win Unlikely to be Bearish

On Tuesday morning, the People’s Bank of China made an announcement. They decided to reduce the reserve requirement ratio for mainland banks by 0.5%, and also lowered the seven-day reverse repo rate (the interest banks pay when borrowing from the central bank) by 0.2% to 1.5%. Furthermore, the minimum down payment required for mortgages was decreased to 15%.

The diversified CoinDesk 20 (CD20) – which follows the price movements of the biggest cryptocurrencies – experienced a decrease of 1.8%.

On account of the recent announcement about securing an additional $100 million in funding, Celestia’s TIA tokens experienced a rise of approximately 17% in value since Monday, contributing positively to their overall market performance.

Stocks Move on China Cuts

Even though lower interest rates and economic stimuli didn’t seem to affect digital assets, stock markets within the region were thriving (or showing positive growth), implying that local investors were more focused on stocks as opposed to cryptocurrencies.

Hong Kong’s Hang Seng index is up 3.2% on the news, while the Shanghai Composite index is up 2.3%.

According to Lynn Song, Chief Economist for Greater China at ING, today’s policy package is likely to cause a slight devaluation of the yuan. This move is expected to lead to an increase in the value of the US dollar compared to the Chinese yuan, due to the easing measures taken by the People’s Bank of China (PBoC). However, long-term factors such as interest rate differences indicate a gradual strengthening trend for the Chinese yuan.

Harris Win Unlikely to be “Bearish”

In other news, representatives from QCP Capital in Singapore expressed in their Monday market update that the assumption of the market regarding Democrat Kamala Harris’ presidency being negative for the economy might not hold true.

The victory of Harris in this election might not be as negative for the market as currently perceived. Over the weekend at a fundraiser, Kamala Harris expressed her commitment to fostering growth within the cryptocurrency sector. This stance was emphasized by QCP, who noted that this is an additional effort to attract crypto voters. Furthermore, Anthony Scaramucci and other crypto supporters are collaborating with Harris’s campaign on their policies regarding cryptocurrencies.

Over the weekend, Harris stated that if they win the election, their administration would foster advancements in tech areas such as Artificial Intelligence (AI) and digital currencies, all while safeguarding consumer and investor interests. This statement represents one of the rare instances where the candidate has shown a favorable stance towards the crypto industry.