The Hong Kong government’s approval of cryptocurrencies beginning in June may open the door for a burst of liquidity, though it may not happen right away. Even yet, it might take some time before there is significant organic demand for cryptocurrencies like ETH.
- Ethereum will be one of the twelve cryptocurrencies that will benefit from Hong Kong’s June pro-crypto move.
- ETH ends the month of May with a false bullish signal.
Ethereum [ETH] is probably going to be among the greatest winners when Hong Kong shakes up the cryptocurrency market. The love-hate relationship with China is currently swinging in favour and may possibly signal the beginning of the next bullish wave.
Thanks to Hong Kong, ETH might be about to ride the bull in June. This is due to the Chinese administrative region unlocking its doors to retail investing for an array of leading cryptocurrencies, including ETH.
The latter will probably reap the greatest benefits because it has a strong environment and a head start.
Today is the day that China's on-again, off-again love affair with crypto is switched back into the on position.
Here's why
— Lark Davis (@TheCryptoLark) May 31, 2023
In light of this, why is Hong Kong’s move to embrace cryptocurrency significant for the crypto community? Hong Kong is, in fact, a gateway for Chinese liquidity to enter foreign or global markets.
More importantly, China made a significant contribution to the massive liquidity that raised prices during prior bull runs. We will probably witness a rise in demand now that the same entrance to cryptocurrency is opening up once more.
Will June be a positive month for ETH?
The Hong Kong government’s approval of cryptocurrencies beginning in June may open the door for a surge of liquidity, though it may not happen right away. However, since exchanges will need to submit applications for their services and go through screening in Hong Kong, it may take some time to anticipate organic high demand. This means that rather than being sudden, incoming demand for ETH will probably be gradual.
There were some fascinating findings regarding the current state of ETH demand. For the majority of May, ETH’s exchange reserves have been decreasing. But as of May 28, we did notice a slight improvement.
Even if it might not have been reflected in the price, a lower exchange supply indicated that there was a sizable demand. In terms of pricing, ETH just had a small increase over the previous five days, although it was fleeting. A revival of sale pressure that had already eaten into some of ETH’s recent gains was finishing May. At the time this article was written, it was trading for $1865.
ETH’s exchange flows indicated that, despite its gains, June would begin with a spike in volatility. The slight spike in exchange reserves at the end of May may be stated, in specific, by an increase in exchange inflows. Comparing May to April, exchange flows drastically decreased.
