Recently, we are witnessing the growing influence of Asia
on the cryptocurrency market, primarily Bitcoin. Which is logical: in the same China, about two-thirds of the cue ball is mined, since energy in the Middle Kingdom is inexpensive, plus you can (for the present) without any problems from various regulators build a mining farm on your river with your own hydroelectric station and work to your pleasure by watching the growth the number of coins in a wallet - and who mines a girl, he dances her.
But it's not only about farms. The Chinese consider Bitcoin and some other cryptocurrencies as a safe haven. The yuan gradually falls against the dollar, respectively, those with the main savings in yuan - become poorer. Well, if you invest in Bitcoin with its rapid growth, you can not only save but also increase your funds. So the Chinese thought more recently. But now the authorities have begun to complicate the lives of those associated with cryptocurrency, and not everything is as simple as before.
Big brother sees everything
First, the country's government, or rather, the People's Bank, banned the ICO, there is even talk
about the death penalty for those who disobeyed. All accommodations that are being held at the moment are ordered to be completed, and the initiators of those ICOs that have already been completed must return the funds to investors. But in just six months, Chinese startups have collected almost half a billion US dollars, so now companies who are fond of primary offerings will have to sweat a lot in order to return everything collected.
At the end of this month, a ban on cryptocurrency trading within the country is expected. The main players begin to understand what is going on, and declare the termination of trading. According to rumors, the discussion of Bitcoin operations gradually migrates from the local WeChat chat (the country's special services have access to it) to Telegram. A confirmation from the authorities about the ban has not been received, but the exchanges are still reinsured. For example, BTCC is going to stop trading from September 30th. Perhaps the reason was the unofficial indication of the authorities, which the Chinese edition, Yicai magazine, learned about.
In addition to the mentioned 2/3 mining, China is responsible for about a quarter of all transactions related to cryptocurrencies (not only Bitcoin), passing through their servers.
But not everything is as bad as it may seem. Yes, initially, after all the news about Chinese bans appeared, the courses of various coins fell down, dropping by a third, or even more, within a few hours. The same bitcoin declined almost to 3 thousand US dollars.
However, on Friday the return movement of the course began, which continued on Saturday and Sunday. Bitcoin in a few days has increased everything that he had lost before. Why was the market able to recover quickly? The fact is that the official ban of the authorities on the trade in Bitcoin inside the country has not been received. Well, the unofficial instruction of the exchange was bypassed simply. The two largest, OKCoin and Huobi, said that the bidding would continue, but a bitcoin / yuan pair would go. It seems that the Chinese authorities are completely satisfied with this situation, the withdrawal of the yuan will not have an effect on the global cryptocurrency market, or this effect will be minimal. However, the bitcoin rate against the yuan soared by 50%.
But even if the exchanges force it to close, Bitcoin trading in China and beyond will continue. For example, the head of the BitMEX exchange Arthur Hayes (Arthur Hayes) believes
that in this case, the Chinese will simply trade in “black” cryptocurrency. Yes, the authorities will try to stop it in the bud. Yes, it is dangerous. But the desire to earn more money will force market players to continue their business.
In addition, we are not talking about the prohibition of cryptocurrency. If anything is banned, these are cryptocurrency exchanges. Other countries are unlikely to follow the example of the Middle Kingdom. The most interesting thing is that the share of Chinese exchanges in Bitcoin trading is gradually decreasing. Since the beginning of the year, this figure fell
from 70% to 25%.
Even if China officially forbids trading in cryptocurrency, such a ban will not continue for a long time. As mentioned above, the black market of cryptocurrency will start to develop, and the government of the PRC does not even want to deal with the illegal circulation of Bitcoin and other coins. As for the ICO ban, here the People's Bank is trying to protect investors' money, because the primary allocation of tokens is not regulated by anyone, so some companies are deceiving their investors.
So, what is next?
Whatever it was, but the permanent ban of the same China on trade in Bitcoin, if it appears, will only have a short-term negative impact. Previously, any negative news regarding cryptocurrency could provoke a drop in the price of the cue ball and other coins for a long time. Now the negative presses the course down for a short time. It takes several days and everything returns to normal.
There are several explanations for this, including the fact that the market has become very flexible. Prohibitive measures that are taken in one country immediately lead to the activation of market players in other regions. As a result, cryptocurrency flows are redirected to other regions where other exchanges operate. And this is a matter of only 1-2 days, in some cases a few hours. In order for Bitcoin, broadcast or any other cryptocurrency to collapse, something very powerful is needed, for example, the joint activity of regulators from several countries at once. But in the near future, nothing like this is foreseen, so you can sleep well. Moreover, all these course jumps make you a lot of money. And the hypothetical (in fact, very unlikely) disappearance of China from the mining market will be a gift for miners from the rest of the world.Get bitcoins before others do it for you: