South African crypto exchange VALR announced that the price of Bitcoin reached one million South African Rands (ZAR). Bitcoin’s price also skyrocketed to 7.9 million yen as investor confidence in South Africa and Japan remains muted.
VALR said earlier today that the current price of Bitcoin was 6% below the all-time ZAR high of the asset’s 2021 high. The cost of Bitcoin in Japanese yen on the crypto exchange bitFlyer reached an all-time high of around 7.85 million yen.
How Weak Rand Impacted Bitcoin’s Price
While Bitcoin breached $52,000 in the US this week, it is still 32% below its all-time high of $69,000. In contrast, the price of BTC surpassed ZAR 1 million ($53,634) but is only 6% below its all-time high of ZAR crypto exchange VALR said.
According to CoinGecko, Bitcoin reached an all-time high of ZAR 1,057,029 on Nov. 10, 2021. Similarly, the price of Bitcoin skyrocketed to an all-time high of 7.9 million yen on the exchange bitFlyer in the past 24 hours.
BTC/ZAR Daily Price Chart | Source: VALR
The different prices can affect trading strategies because of differences in economic climates. For example, in South Africa, investors are uncertain about the future of the Rand. The president’s State of the Nation address did little to quell that anxiety, according to news outlet The South African.
“Over the past week, the South African Rand weakened further against most currencies, including those from emerging markets and developed countries…Last week’s State of the Nation address in South Africa, presented by Cyril Ramaphosa, did little to boost confidence in the national currency,” the publication said.
Read more: Cryptocurrency Regulation in Africa: What We Know So Far
The political backdrop of the weakening rand is the May 2024 presidential election. Rolling electricity blackouts and dissatisfaction with service delivery have turned citizens against the country’s ruling African National Congress. On a positive note, crypto businesses may receive licenses from the Financial Sector Conduct Authority this year.
Japan Bitcoin Investors Beware
Investor confidence in Japan is muted after the economy contracted for two quarters. The central bank faces a dilemma of negative interest rates amid contractions. According to analysts at ING and Moody’s Analytics, this will not change any time soon.
Read more: TradFi Explained: Exploring Key Elements of Traditional Finance
“The Bank of Japan will likely now become even more cautious about any policy change,” ING’s Min Joo Kang said.
However, the central bank is hoping for the traditional spring wage negotiations that could trigger an exit from its negative interest rates. But it could be some time before the economy reaches growth levels that could inject more liquidity to encourage Bitcoin trading and business expansion. In the meantime, the central bank has committed to a central bank digital currency (CBDC), which it says can coexist with the current version of the yen.
BeInCrypto has contacted South African crypto exchange VALR and the Bank of Japan for comment but has not heard back at press time.
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