Central bank steps in? China's biggest Bitcoin traders are going all-in on Bitcoin

Rage Comment : Cryptocurrency regulation is currently in a vacuum around the world, so trading activities in various countries are still in a gray area. Therefore, the recent news that the People's Bank of China publicly interviewed Bitcoin exchanges Bihang.com, Huobi.com, and Bitcoin China has had a great impact on the domestic Bitcoin market behavior and prices. It has also once again raised concerns about the authenticity of the domestic Bitcoin market transaction volume. However, based on the development trend of domestic cryptocurrencies and their status in the global blockchain field, it can be predicted that this meeting will not have a long-term impact.

Translation: Annie_Xu

The recent news about the central bank's strict inspection of domestic Bitcoin exchanges has not troubled traders.

Media reports say that members of the domestic bitcoin trading community, as well as cryptocurrency exchange operators, believe that further regulation will be beneficial to the long-term development of the industry.

One OTC trader interviewed said he trades 250 BTC (about $150,000) a day and is not concerned about the future of the technology.

Overall, he believes that the People's Bank of China is not trying to resist the technology, but to prevent investor risks, and does not intend to prevent or restrict the application of the technology.

“There is indeed panic selling, but Bitcoin enthusiasts like me are not worried at all. In fact, it is a good opportunity to make money.”

The operator of FinTech Blockchain Group, a domestic bitcoin hedge fund that has raised $20 million in funding, said domestic traders are not worried about the government taking any action despite high market volatility.

"Everyone got the news."

The central bank publicly summoned Bitcoin exchanges Bitcoin China, Bihang.com, and Huobi.com, causing the Bitcoin market to fluctuate and the price of Bitcoin to plummet.

Trading Trends

Despite the market confidence, some trading firms have seen a change in client behavior following the price drop.

For example, OTC trading company Richfund pointed out that when the price rose to a high of 1153, the number of customers increased rapidly, and then the stable growth rate began to slow down.

This situation is worthy of attention. After all, over-the-counter transactions usually only attract large investors, and their large purchases will cause the price of Bitcoin to fall.

“It does impact OTC volumes. Some people are concerned, but we assure them that this kind of volatility is not common in Bitcoinland.”

CHBTC, an exchange with a daily Bitcoin trading volume of 115,000 BTC/CNY, said that trading activity has slowed down, but new customers are also increasing.

A representative of the exchange said:

"Most traders are waiting and watching."

She said CHBTC welcomes regulation, a statement made by BTCC and OKCoin when the news broke last week.

Fake trading volume

Although the impact of this news has gradually faded, people are beginning to worry that the government will take new enforcement measures in the future.

There have been allegations in the West that domestic exchanges are falsifying trading volumes, which has damaged the credibility of these companies.

However, not all trading volume is fake, but some domestic "speculators and arbitrageurs" have driven the growth in trading volume.

Harry Yeh, managing partner of US over-the-counter trading firm Binary Financial, said the Chinese market is huge, at least bigger than the West knows.

"I think people underestimate the influence of Bitcoin in China. Some of the world's largest traders and miners are in China."

However, news of market fraud does have a negative impact.

As for the impact of the incident on Bitcoin enthusiasts, he said China did not block transactions and its underlying blockchain and peer-to-peer design will continue to develop.

A representative of Yunbi.com said that although they did not attend the central bank meeting, they were not worried about the impact of the incident.

"From the perspective of Bitcoin development, this is a good thing."