Chinese State-Owned Media Try to Dampen Market's Crypto Enthusiasm

Chinese state-owned media are attempting to quell the rush into crypto stocks following President Xi’s statement to “seize the opportunity” afforded by blockchain.

State-backed agencies are publishing material meant to encourage “rational” investments, amid this surge in speculation in blockchain and fintech firms, Reuters reported Tuesday.

On Monday, over 100 public fintech companies – tied or tangentially related to blockchain – soared in price at market opening as sentiment around the sector turned bullish, but perhaps too much so.

“Blockchain’s future is here but we must remain rational,” wrote the state-backed People’s Daily newspaper late Monday night.

Echoing a statement espoused by China Central Television this weekend, the newspaper continued:

“The rise of blockchain technology was accompanied by that of cryptocurrencies, but innovation in blockchain technology does not mean we should speculate in virtual currencies.”

Reuters also reported that the independent Shanghai Stock Exchange warned traders, “for any blockchain-related (topics), we ask listed companies to make statements based on facts and not make any exaggerated claims or create vicious hype."

While there has been much hype, the enthusiasm followed by news of 500-plus specific enterprise blockchain projects already in motion in China and registered over the past year.

Crypto-frenzy spurred by Xi wass not limited to China. This morning, the Antigua and Barbuda-based derivatives exchange FTX announced an index fund comprised of eight China-related cryptocurrencies.

Chinese stocks image via Shutterstock