Unfortunately, the bitcoin (BTC) price will not continue the upward trend that manifested itself a few weeks ago. A relatively large crash caused the crypto markets quite red colored. Of course no man has gone overboard yet, but the intensity of the crash was remarkable.
Colin Wue
According to a well-known analyst on Twitter, Colin Wu, this crash had a very clear reason. According to him, a Chinese real estate company was responsible for the recent sharp correction.
He indicates that the stock market in Hong Kong simultaneously experienced a severe correction. The Hang seng index in particular lost a lot on the Hong Kong stock exchange. This index fell as much as 7% in a short period of time, reaching a low not seen in a year.
The Hong Kong stock market plummeted, triggering a decline in global markets and cryptocurrencies. The main reason is Evergrande, China’s largest real estate company with nearly 2 trillion debts. Tether just clarified that it does not hold Evergrande commercial votes.
— Wu Blockchain (@WuBlockchain) September 20, 2021
The reason for the stock market crash in Hong Kong can be attributed to a single Chinese company, Wu said. This concerns Evergrande Estate Group. This is the second largest real estate company in China and is even in the Fortune 500 of the largest companies in the world.
Evergrande is not doing well. According to Wu, the company has more than $2 trillion in debt and the company’s stock has plummeted in recent times.
A real estate giant with such an amount of debt is causing a headache for investors around the world. Not only in the traditional stock market, but also in the world of crypto. According to Wu, virtually every asset class was impacted by developments in China and Hong Kong. A debt crisis at a real estate company of this size is obviously not an attractive development.
The famous news platform Bloomberg also shared Colin Wu’s conclusion. They also point out that the uncertainty surrounding the gigantic Evergrande Estate Group is causing crypto investors to take their eggs for their money.
Cryptocurrency prices slump as a broad selloff sparked by worries about contagion from China Evergrande Group sweeps through global markets https://t.co/kLlREHrmUh pic.twitter.com/ZLEgAJYdnu
— Bloomberg Crypto (@crypto) September 20, 2021
Whether the recent crypto crash was actually caused by the Chinese real estate company is of course impossible to say. Nevertheless, there are some leading analysts who are firmly convinced of this.