China’s Baidu Search Trends Suggest the Country Drove Bitcoin’s May Bull Rally
- China's bitcoin popularity has definitely been on the rise
- Interest in bitcoin in both China and the World increased similarly and on the same dates
- Alex Kruger finds a bearish divergence, in both China and the World interest dropped drastically while the price kept on going higher since mid-May
China’s stance on cryptocurrencies has been negative as it crackdown on Bitcoin mining companies. However, it didn’t stop the population from pursuing bitcoin as an investment.
During the ongoing US-China trade war, Chinese investors have been reportedly looking to offset the fear of a tumbling yuan, that dropped over 2 percent against USD following President Trump's increase in tariffs. As a result of this spat that keeps on escalating, they are converting the local currency into USD or Bitcoin.
With China putting capital control measures on withdrawing a specific amount of USD, Bitcoin made for an attractive investment option. Dovey Wan of Primitive Ventures observed this trend early on when she pointed out how Bitcoin is winning this war.
Economist and trader Alex Kruger took to Twitter to share that there is some truth to the theory many analysts have been pushing out that China drove the gains in the price of the Bitcoin last month. After seeing a monster rally that took BTC up by 60 percent, June is not turning out to be good for the leading cryptocurrency, at least so far, as BTC price is down 6.35 percent in the past 24-hours.
In the thread shared by Kruger, he takes a look at the bitcoin trends on China’s Google, Baidu. Kruger did the research and find out that,
“China's bitcoin popularity has definitively been on the rise.”
In the assessment shared by Kruger, it can be seen that the number of Bitcoin search term on Baidu and the BTC price do match up that goes back to April. Bitcoin trended as the price surged from about $4,000 level to above $5,000. In May, this correlation became critical as from $6,000 breakout to $7,000 and the price topping at $8,350, the searches went up as well.
“Interest in bitcoin spiked either after price breakouts or during breakouts,” said Kruger.
However, it’s not all as Kruger shares there are similarities in the interest in Bitcoin from China and around the world as Baidu Trends and Google Trends share the same movements.
“Both interest in bitcoin in China (as measured by Baidu Trends) and in the World (as measured by Google Trends) increased similarly and on the same dates (note: dates adjusted by time zone),” shared Kruger while providing the following illustration,
However, since May 14th both in China and the world the internet in Bitcoin dropped drastically. This, as Kruger notes, is a “bearish divergence” as the price kept moving higher.
As we enter into June, the Baidu trends level are back to the May 9th levels when the Bitcoin price was trading at $6,000. Currently, we are at $7,935 from the high of $8,830 on June 2nd.