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The People’s Bank of China injected $18.6 billion into the banking system after the Evergrande debt crisis sent shock waves through most financial markets, including cryptocurrencies.© Provided by Benzinga

What Happened: On Wednesday, Bloomberg reported that China’s central bank has injected 120 billion yuan ($18.6 billion) into its system in the form of reverse repurchase agreements.

Mitul Kotecha, chief emerging markets Asia & Europe strategist at TD Securities in Singapore, described the injection as “a relief” and said it pointed to a desire to “keep stable liquidity in the days.”

If the government is successful in preventing a more systemic crisis from unfolding, some believe that affected markets could see a reversal in the bearish trend that recently took effect.

Sorry to be the guy who asks the awkward question but… when can we expect to see China bailout Evergrande and pump the market?

— The Wolf Of All Streets (@scottmelker) September 20, 2021

At the time of writing, Bitcoin (CRYPTO: BTC) was trading at $42,569 and Ethereum (CRYPTO: ETH) was trading at $2,953. Both crypto assets lost more than 10% of their value over the last seven days, leading to deeper losses across most altcoins.https://products.gobankingrates.com/pub/84d1cf40-924a-11eb-a8c2-0e0b1012e14d

“Crypto overreacts so hard to every little thing, both good and bad,” said Dogecoin (CRYPTO: DOGE) co-founder Billy Markus on Twitter.

“I guess that’s what happens when you have billions of dollars tied up in human emotion as gambling markets on made-up coin token things,” he added.

According to another market proponent, Lark Davis, the crypto market is actually going through a “normal” cycle despite all the market drama.  

3 Last two bull runs saw sell offs in July following massive runs, both also saw sell offs in September, exactly as we are seeing in 2021. In both previous runs #bitcoin went on for a parabolic yearly finish. history doesn’t repeat, but it sure does rhyme. pic.twitter.com/07wN03cWPd

— Lark Davis (@TheCryptoLark) September 22, 2021

“While the fear has been high this week, I remain bullish for the end of this year,” he said, adding  that “Q4 is usually very bullish for Bitcoin and what is good for the golden BTC goose is good for the altcoin gander.” SOURCE Could China’s $18.6B Liquidity Injection Amid Evergrande Crisis Benefit Crypto Markets? (msn.com)

By block head

Block Head is a blockchain journalist.