Chain Reactions: Hong Kong Classifies Crypto as “Property”; Bitcoin ‘halving’ anticipation is growing
Action-wise, it’s been a slow day for Bitcoin and the crypto market, but there’s still some interesting news you might have missed, including the fact that Hong Kong’s High Court has declared crypto property in an eye-opening new ruling.
The new decree states that crypto is classified as “property that can be held in trust”, which is the first time a final decision on the classification of the asset class has been made in the special administrative region.
Judge Linda Chan, who presided over the case, said that “like other common law jurisdictions, our definition of ‘property’ is inclusive and intended to have a broad meaning.”
Global law firm Hogan Lovells first reported on the ruling last week, indicating that the decision provides clarity and places cryptocurrencies “on par with other intangible assets such as stocks and shares” in Hong Kong.
Hong Kong has stepped up its efforts to embrace the crypto industry, and achieving a level of classification clarity from an official governing body puts the region’s streets ahead of the US currently, where the US Securities Exchange and Commodity Futures Trading Commission can’t even agree on whether Ethereum and co securities or raw materials.
Halving expectation grows: Swyftx
Bitcoin (BTC) balances on exchanges have reportedly decreased significantly (as a percentage of circulating supply) in this halving “epoch” cycle compared to the previous three epochs.
What does that mean? That could possibly mean an increase in the HODLing (hold on so long) narrative in the final years of this last four-year cycle for Bitcoin. And it could indicate strength in the resolve of long-term BTC holders as they presumably seek to store their assets in cold storage and away from centralized exchanges.
This chart, if accurate, would dovetail nicely with some of the other stats and opinions we’ve heard lately.
For example, Tommy Honan, head of commercial operations at Australian crypto exchange Swyftx, mentioned to Coinhead in an email that:
“The anticipation surrounding the next Bitcoin halving is suddenly very real.”
And it comes on the back of some startling data the exchange saw in March for Bitcoin – a month where the five best days of Australian BTC trading so far this year all occurred.
“There are no clear and obvious triggers for Bitcoin’s 80% price rise this year beyond some concern over recent US banking turmoil,” Honan noted.
“So we apply the Occam’s Razor rule that the simplest explanation is the most likely. We think the most plausible explanation for Bitcoin’s price movement is anticipation around the halving, and that this in turn is fueling local trading activity.”
The halving, in case you weren’t aware, is the built-in four-year mechanism that serves to halve the reward of Proof-of-Work miners operating in the Bitcoin network.
Halvings reduce the rate at which new coins are created, effectively reducing supply. The Bitcoin halving happens every 210,000 blocks, or roughly every four years. In the past, Bitcoin halvings have subsequently resulted in significant price increases.
“We are nowhere near all-time high trading territory,” Honan continued. “But local Bitcoin trades are clearly trending up with hundreds of millions of Aussie dollar denominated Bitcoin trades in March.
“We reached the one-year countdown to the halving this month, and that appears to be a factor influencing Bitcoin price action and national trading activity.
“Bitcoin trading this month remains high at January and February levels, and we see a strong trend toward accumulation, with buy orders outstripping sales by a factor of three.”
Top 10 overview
With the total crypto market capitalization at $1.21 trillion, down about 0.6% since this time yesterday, here is the current status of the top 10 tokens – according to CoinGecko.
