Bitcoin acts as leading indicator of global market liquidity: Xinhua Group

Bitcoin has shifted from a standalone narrative-driven asset to a standardized financial asset and now serves as a leading indicator of global market liquidity, Hong Kong-listed crypto firm Xinhua Group said. Fu Peng, the firm’s chief analyst, said at a recent private seminar that BTC was the first asset to enter a contraction cycle under the current liquidity-tightening environment. Fu added that its price is determined more by the amount of liquidity in circulation than by intrinsic value, and that BTC has become a leading indicator reflecting market liquidity in advance as it reacts more quickly and more sensitively than other assets to liquidity conditions such as Federal Reserve tightening and funding stress.