[Bitcoin Now] Easing Shock from China’s Evergrande Group... Rebounds to 53 Million Won Range

Powell Fed Chair "Evergrande Group Issue Limited to China"
Evergrande Group Also Announces Interest Payment on Bonds Maturing September 2025

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Gong Byung-sun] Bitcoin, the representative cryptocurrency that once fell to the 50 million KRW level, has rebounded to the 53 million KRW range. Although the cryptocurrency market was shocked due to bankruptcy concerns surrounding China’s largest real estate developer, Evergrande Group (China Evergrande Group), it appears to be gradually stabilizing.

According to Upbit, a domestic cryptocurrency exchange, as of 3:05 PM on the 23rd, Bitcoin recorded 53.97 million KRW, up 0.21% compared to the previous day. Bitcoin had plunged to 50.05 million KRW the day before but has been gradually recovering since. It even rose to 54.65 million KRW at 12:34 PM that day.

The cryptocurrency market seems to be recovering from the shock caused by Evergrande Group. Although risk-averse sentiment had spread, it is somewhat calming down. According to the US economic media Bloomberg on the 22nd (local time), Jerome Powell, Chairman of the US Federal Reserve (Fed), said at a press conference after the Federal Open Market Committee (FOMC) regular meeting that “US banks are not directly related to Evergrande Group’s debt issues” and “the Evergrande problem will be limited to China only.”

Evergrande Group also announced it would partially repay interest. On the 22nd, Evergrande Group stated that it would repay interest of 232 million yuan (approximately 42.26112 billion KRW) on bonds maturing in September 2025, traded on the Shenzhen Stock Exchange, on the 23rd. However, it did not mention whether it would repay interest of 83.5 million USD (approximately 98.3563 billion KRW) on bonds maturing in March next year.

The possibility of Evergrande Group’s bankruptcy has been raised since this spring. Due to reckless business expansion, Evergrande Group accumulated debt exceeding 350 trillion KRW and fell into a liquidity crisis, failing to pay interest on time. Experts have likened this to the Chinese version of the Lehman Brothers crisis. The Lehman Brothers crisis refers to the event where the US’s representative investment bank Lehman Brothers went bankrupt due to the collapse of risky derivatives such as subprime mortgages it had invested in. This led to the 2008 global financial crisis.