In the light of the much-awaited cryptocurrency launch in China, the stocks of fintech companies in Chinese markets are skyrocketing.
As the Chinese cryptocurrency gears up to make its debut later this year, the fintech firms are making a killing overnight. Sectors that are likely to get impacted by the launch are e-wallet companies, financial services, IT service providers, security and custodian firms, and banks.
The CSI fintech theme index shows that the financial technology firms are reaping the benefits of the cryptocurrency launch as they stand to gain over fifty percent (50%) in stocks this year, surpassing the rest of the industry.
Cryptocurrency launch in China stirs market emotions
Beijing Certificate Authority, a state-owned company offering information security and digital authentication services, was among the big gainers. This year, its stock prices have gone through the roof as it has already registered a two hundred percent (200%) spike so far.
Moreover, China’s largest security network provider, 360 Security Technology Inc, recorded a fifty percent (50%) increase in share prices this year.
China’s digital currency “almost ready”
Meanwhile, Mu Changchun, deputy director of the People’s Bank of China, declared last month that China’s digital currency is as close to “being out.” Although he did not elaborate on the timing of the launch, he is confident that the central bank is fully prepared to establish governance over its distribution and supply.
With a Facebook Libra-like similarities in its framework and offerings, the fiat currency alternative can be used across significant payment platforms, including Alipay and Wechat. The customers would need to install an e-wallet on their mobile phones and get access to the digital currency within a few clicks.
Thus, the investors flocking to purchase fintech firm shares this early may come as imprudent to many, however, China is the only country in the world so far, who has aggressively worked towards launching a digital currency and that gives enough reason to spur market emotions.