Hayes writes that the history of cryptocurrency capital markets is centered in North Asia, particularly in Greater China, which includes the so-called "Mainland China" as well as Hong Kong, Taiwan and Macau. Thus, margin trading and stabelcoins were launched by the Hong Kong-based Bitfinex platform. Perpetual Swap was invented by BitMEX, also based in Hong Kong. And the largest trading volumes take place on the Binance platform, which also originated in Greater China.
That said, Hayes argues that centralized U.S. exchanges have brought absolutely no innovation to the cryptocurrency capital markets. In his opinion, platforms such as Coinbase, Gemini, and Kraken are simply places where U.S. retail and institutional investors can acquire and store cryptocurrency.
Despite the fact that at one point China began to impose bans on cryptocurrencies and Hong Kong began to lose its position as the most important crypto-hub, Hayes points out that this is now beginning to change.
The news that Hong Kong intends to legalize cryptocurrencies is seen by the crypto-enthusiast as the beginning of China's "crypto-domination reset. According to Hayes, Hong Kong's cryptocurrency-friendly reorientation bodes well for China's reassertion in the cryptocurrency markets.
Retail traders cannot trade cryptocurrency in China, but based on information that the Hong Kong Securities and Futures Commission (SFC) is willing to allow retailers to buy and sell cryptocurrency directly, Hayes concludes that Chinese capital could flow into Hong Kong through this trade.
According to the essay's author, this reorientation of Hong Kong toward pro-cryptocurrency is one element of Beijing's financial strategy. If these flows really materialize in this way, they will become a strong pillar for the next bull market, Hayes believes.
At the end of September, Arthur Hayes predicted that bitcoin prices will fall to June lows near the $17,500 mark by the end of this year. According to famous bitcoin-maximalist, the decline will lead to a decrease in liquidity in the U.S. dollar because of the current monetary policy of the U.S. government.
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