The problem for the cryptocurrency in China seems far from ending. The authorities and regulators in China have announced that in order to remain complaint “all” Chinese virtual currency exchanges must stop trading.
The reports coming in from China seems to be having a bad news for Bitcoin exchanges. The information slowly coming from China has confirmed that trading taking place for Bitcoin-to-fiat platform will no longer be legal. Bitcoin prices have already started reacting in a downfall to this. The losses in the last 24-hours have approached 21% at $3000.
Cryptocurrency CEOs have reacted to BTCChina. Many Bitcoin firms have started shutting down with future plans stalled. Industry experts said that markets have reacted harshly to the Chinese regulatory move. According to industry players, long-term benefits for Bitcoin’s ethos and therefore stability were clear and quite high. The crackdown on Bitcoin also indicates that the development of non-custodial and decentralized models will accelerate.
Chinese investors have become notorious for their short-term trading activities in the past. The results of such activities have been the volatile nature of Bitcoin trading in the past years. The latest regulatory warnings produced a second mass exodus to p2p trading platforms. The major one of these has been Localbitcoins this year. With sanctioned Bitcoin-to-fiat trading looking to stop in China altogether, the major market influence will disappear. Experts, however, believe that this might not be the case forever.
It is hard to believe that China intends to exit a market that has so much potential. The Chinese government is building a cottage industry for mining that will leverage bitcoin and other cryptocurrencies. The ban is seen more as a stopgap to get certain Chinese policies in place. The apparent ban on ICOs is seen only as short term. The ban, however, shows the volatility of the space and the new marketplace. Many believe that certain segments of the market will take advantage of the unclear news cycle to create a sell-off and buyback opportunity.