The post China’s Economic Slowdown: What It Means for the Crypto Market appeared first on Coinpedia Fintech News
China is a prominent economic superpower. It has a GDP of $17794.78B, which represents at least 16.88% of the world economy. China is known as the factory of the world, with its export-powered economy acting as the primary supplier to major economic powerhouses, including the United States. The US economy has a strong relationship with China, importing goods worth at least $448.02B – the second largest by country for US imports in 2023 after Mexico. It was China’s low cost of production that helped the country to rise to this enviable status.
But the latest data indicates that things are not all positive in Beijing anymore. It is important to understand this scenario to assess if there is any immediate threat to the cryptocurrency community due to this new global economic scenario.
Analyzing the Recent Decline in China’s GDP: What’s Happening?
Last year, the GDP of China was 17.8K USD Billion. In 2022, it was nearly 17.9K USD Billion. This data alone is enough to signal that something is wrong in the Chinese economy. This shrinking in the GDP is not usual for the country – known for its rapid growth history. In 2012, the GDP was 8.53K USD Billion. By 2020, it grew to 14.7K USD Billion. In 2021, it saw a massive growth of 17.8K USD Billion. In 2022 also, the trend continued. However, things reversed in 2023. The shrinking of GDP in 2023 was the first such instance reported since 2012.
When we analyze other factors – from industrial output, retail sales, and the property sector, to unemployment rates and mortgage rates – we can see the initial signs of an impending collapse. Almost all the major indicators, including industrial output, have reported a fall in the recent past.
Is it because of the aging population? One of the biggest issues the country is battling right is its shrinking workforce.
Whatever the reason, what China needs right now is visionful economic intervention – either in the form of an economic stimulus package or creative policies.
China’s Rumoured $1.4 Trillion Stimulus Package: What It Means for Crypto?
There are rumors that China is preparing to unleash an economic stimulus package worth $1.4 trillion to revive its economy. If such a move occurs, it will have a serious impact on the global economy. The cryptocurrency second will definitely be one of the beneficiaries of this possible economic shockwave from China.
In conclusion, the crypto community is closely watching the developments in China. If China executes this unprecedented strategy to help its economy recover from the brink of collapse, it will be one of the biggest stimuli the crypto sector can get right now. What do you think?
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A recent video shared in Youtube by Lark Davis, a crypto expert, also shares a similar view.