According to Fox News, China has officially abandoned its decades-old two-child policy as birth rates have dropped to historic lows (Source: Fox News, June 5, 2025). This demographic shift is expected to intensify concerns over long-term economic growth and labor shortages, which could increase market volatility and impact investor sentiment in both traditional and crypto markets. Analysts note that uncertainty about China's future economic trajectory may drive increased interest in cryptocurrency as a hedge against potential yuan devaluation and economic instability.

According to André Dragosch, PhD, the potential pre-emptive devaluation of the Yuan by Chinese authorities could alter competitive dynamics by counteracting US tariffs. This move might signal increased monetary easing in China, which could influence cryptocurrency markets by impacting investor sentiment and liquidity flows. Traders should monitor these developments closely as they could affect market volatility and trading strategies.