Bitcoin rises above $70k as China's debt plan sparks open interest
Bitcoin rises above $70k as China's debt plan sparks open interest
Bitcoin’s role as a hedge against monetary debasement may see a fresh boost as China considers an ambitious new debt initiative.
China is eyeing over 10 trillion yuan (approximately $1.4 trillion) in fresh debt to aid local governments in managing fiscal risk. This potential surge in debt coupled with mounting concerns over global financial stability, is drawing renewed interest in Bitcoin as an alternative asset.
Bitcoin’s status as a store of value could gain traction, particularly among mainland Chinese traders, who view it as a hedge against the risk of currency devaluation. As BitMEX co-founder, Arthur Hayes has pointed out this developing trend. He noted that Bitcoin’s appeal as a “monetary hedge” is intensifying alongside China’s growing debt levels.
Rising Open Interest Reflects Sentiment Divide Among Traders
In parallel, open interest (OI) across major Bitcoin trading venues is experiencing a rapid increase. CryptoQuant data estimates bitcoin OI currently sits at $22.7 billion, with market players split nearly evenly.
Remarkably, about half of this open interest is now positioned by bears, suggesting a palpable standoff in sentiment. This high OI reflects a mixed outlook but also opens a potential opportunity. Some analysts have advised traders to pay close attention to risk management, hinting that bears’ positions could be “liquidated to drive the price up.” This competitive OI atmosphere underscores Bitcoin’s heightened appeal and leaves the door open for significant price moves.
Early in today’s Asian session, Bitcoin leaped past the $70,000 mark, reaching a new 21-week high and closing in on its all-time peak of $74,000. This recent breakout has potentially set $70,000 as a new level of support. With Bitcoin’s Relative Strength Index (RSI) currently signaling overbought conditions, caution is in the air. If long holders decide to lock in profits, $70,000 may act as a critical support level where bulls could regroup and initiate fresh longs, aiming to keep momentum on their side.
Bitcoin is closely approaching its all-time high. Despite this, there's no surge of interest in Bitcoin on Google.
