Beijing Pours Billions—Is Bitcoin on the Verge of a Breakout?

Bitcoin evolves at the intersection of major geopolitical tensions and global monetary strategies. While financial markets expected the United States to take the lead on the issue of bitcoin reserves, it is ultimately China that could trigger an unprecedented economic earthquake. A series of discreet initiatives led by Beijing suggests a possible massive influx of liquidity into the crypto ecosystem, with a potential impact of $1.4 trillion. Behind this strategy lies an explicit desire to stabilize the yuan in order to circumvent sanctions and US monetary policy.

Beijing injects liquidity: a fertile ground for risky assets

The signals of economic stimulus are multiplying in China, and their effect could transcend traditional financial market boundaries. According to Pan Gongsheng, governor of the People’s Bank of China, interest rate cuts and liquidity injection through lower reserve requirements for banks are planned “at the right time”. This announcement comes as Beijing must deal with the trade tensions exacerbated by Donald Trump’s protectionist policy, which threatens to lead to a global trade war.

Last November, China already unveiled a $1.4 trillion plan aimed at supporting its local governments and maintaining financial stability. “When China tightened its monetary policy and injected liquidity in 2015 and 2020, those funds were often redirected towards alternative assets,” explains the platform Nexo. Indeed, the hypothesis that this new liquidity could directly benefit cryptos, particularly bitcoin, is becoming increasingly plausible.

Could there be a state bitcoin stock? A high-risk strategic game

Beyond the mere injection of liquidity, some rumors suggest that Beijing might go even further by constituting a strategic reserve of bitcoin. This hypothesis, relayed by David Bailey, CEO of Bitcoin Magazine and advisor to the Trump campaign on cryptos, mentions “closed-door meetings since the election” on this issue.

If this information is confirmed, China could thus outpace the United States, where Donald Trump has publicly declared his intention to create a national bitcoin reserve. Beijing would then adopt an offensive posture and use bitcoin as a strategic tool to compensate for the restrictions imposed by Washington.

The impact of such a scenario would be colossal: beyond a simple upward movement, a Chinese state reserve of bitcoin would completely disrupt market dynamics, further enhancing institutional adoption and the legitimacy of bitcoin as a strategic asset.

Towards a repositioning of Bitcoin in the balance of monetary powers?

Arthur Hayes, co-founder of BitMex and founder of the investment fund Maelstrom, warns: “Beware of China.” In a blog post published on March 4, 2025, he predicts a “final spasm of the fiat financial market” before the global economy, driven by the United States, can “inflate and propel bitcoin beyond a million dollars.” If China indeed accumulates bitcoin on a large scale, this could accelerate this unprecedented monetary restructuring, speeding up institutional adoption and further legitimizing crypto as a reserve asset.

These decisions from China go beyond simple economic adjustments. They could well reshape the global monetary chessboard. Historically resistant to cryptos, Beijing now seems to play a pragmatic card by gradually integrating bitcoin into its financial strategy.

If China were to diversify its reserves with bitcoin, it would create a new dynamic of scarcity, which would lead to considerable upward pressure on its price. Furthermore, it would open a new chapter in Sino-American rivalry, where financial supremacy would go beyond traditional currencies but would now include cryptos. In this context, bitcoin appears as a refuge against inflation and monetary instability, but also as a strategic weapon in the hands of major powers. The outcome of this battle remains uncertain, but one thing is sure: the era when bitcoin was just a speculative asset is well and truly over.