New Mosaic Crypto Research Shows Asian Influence is Stronger than US and EU on Bitcoin Effect
Recent history is replete with research and discoveries made in the west that has revolutionized one's life and lifestyle. Therefore it would be natural to assume America and Europe would be the decisive driving force when it came to the countries impacting bitcoin prices. A fallacy startingly exposed by recent research which has found that the Asian markets actually have maximum impact.
The West Is The Best?
There has been a slew of activities in the United States that has brought Cryptos into focus. News about Securities and Exchange Commission [SEC] approvals and (mostly) rejections for Bitcoin ETFs or introduction of various cryptocurrency derivatives makes one incorrectly assume that this is the main market driving force. When Jay Clayton, the Chairman of the US SEC answered questions about their stance on cryptocurrencies, he had said: “We’ve (the SEC) been doing this for a long time, and we’ve built a $19 trillion economy, a securities market that is the envy of the world, following these rules.” The next day the market fell.
There are few who will argue with the near total dominance that the Western countries exert over the mainstream asset market, it is after all home to most of the developed nations of the world. However, the same metrics do not apply to Bitcoin and the other coins, thus they need to be seen with a pair of fresh lenses. Yet, many self-styled “trading gurus”, based in the US, continue to discuss how things like the CME or CBOE BTC futures are affecting Bitcoin prices.
In their study, the cryptocurrency data and research firm, Mosaic have shown that contrary to popular perception, news coming out of Asia has had a greater impact on the cryptocurrency market than previously thought. Data analyzed shows that nearly a dozen major news pieces that came from Asia concerning cryptocurrencies had a direct negative impact of about 20 percent on the market.
To understand this better, Mosaic points out how the markets crashed by nearly 50 percent when CoinMarketCap removed data from a number of South Korean exchanges. On the other hand, when China devalued its currency, many noted how Chinese citizens turned to Bitcoin. This saw the mid-year BTC rally when prices hit more than $8000. Using these and other such instances as its proof, the document shows that increasingly it is Asia and not the West, that is the primary force behind the cryptocurrency markets.
Asia Has Already Been Leading Segments
With its cooler inland climes and discounted electricity rates, China is hosts more than half the mining output of the industry. Even after the country came down heavily on crypto exchanges, surrounding nations, such as Singapore, Korea and Japan, continued to be attractive options for such business. This focus on localized interactions has ensured that while Asians don't rank high on crypto retention, they do account for high trading volumes.
Another decisive factor is the large young population that is aware of the technology. With most “developing economies” corruption is a huge issue, Blockchain offers a solution like few other alternatives. This has made many countries like Thailand and Indonesia look towards this as a viable option.
Talking about an aspect that has been ignored, gaming; CEO of Hong Kong-based BitMex platform, Arthur Hayes, felt that Cryptocurrencies fit right into Asian sensibilities and thus the market is more developed. Talking about the impact that gaming has had, he said “Asia dominates cryptos because they’re very used to digital trading assets. South Korea has been trading digital goods related to gaming for two decades. When you move to a purely money based digital currency, they understand that culturally, so they get on board quickly.” Therefore, it stands to reason that news out of that region would have a much greater sway on the market than in the US and Europe.
The researchers drew the conclusion that Asia now has a pivotal role in cryptocurrencies and that investors observing crypto prices should pay attention to the news from the East, especially the Far East. This should not surprise the average crypto enthusiast as Asian giants such as Korea and Japan have been continuously strengthening their crypto laws to give the fledgling industry a fair chance.