China's impressive economic performance in Q2 2025 has created mixed signals for digital asset markets. Beijing's monetary policy transmission mechanisms are exhibiting complex influences on cryptocurrency pricing through changing correlation patterns.
China's economy grew by 5.2% in this quarter, surpassing analysts' expectations of 5.1%. Information from the National Bureau of Statistics on Tuesday indicated sustained growth momentum despite facing increased global trade tensions, facilitating strategic repositioning of digital assets.
Mixed economic signals
Although the US has increased tariff measures, China's export sector has shown significant strength. Exports in June surged, bringing the trade surplus to $114.8 billion thanks to market diversification and preparatory behaviors.
However, challenges in domestic consumption remain beneath the surface of overall growth. Retail sales dropped to 4.8% year-on-year in June, down from 6.4% in May, despite Beijing's 300 billion yuan consumer stimulus program. Investment in real estate also declined by 11.2% in the first half of the year, continuing to pressure the economy.
Macroeconomic correlation dynamics with Bitcoin
Digital asset analysts are closely monitoring established correlation patterns between China's stimulus measures and Bitcoin price volatility. Current data shows a 30-day correlation coefficient of 0.66 between the expansion of the People's Bank of China's balance sheet (liquidity injection measures) and Bitcoin pricing—a relationship that tends to increase during periods of economic instability.
As the People's Bank of China implements stimulus packages, surplus liquidity often flows into risk assets, including cryptocurrencies. The depreciation pressure on the yuan further drives capital flows from China towards Bitcoin as a hedge against currency devaluation and capital control measures.
The strong growth of GDP may reduce the ability for immediate stimulus, thereby limiting the potential price increase of Bitcoin due to correlation effects. Conversely, prolonged weakness in domestic demand may require additional monetary support measures.
