The crypto-currency market is booming right now and although Bitcoin is reaching unprecedented heights, the Chinese authorities are adopting some unexpected behavior. The People’s Bank of China has decided to ban all transactions around this asset throughout the country. But this is not so surprising when we consider the behavior of Chinese regulatory authorities compared to Bitcoin in recent months.
China VS Bitcoin
In September, the People’s Bank of China, together with the China Insurance Regulatory Commission, the China Securities Regulatory Commission, and the China Banking Regulatory Commission, issued an announcement banning the sale of Bitcoins. Last July 18th, a report from the National Committee of Experts on Financial Security Technology of the Internet indicated that more than 90% of ICO projects were not in compliance with the laws on the collection of funds or fraud. The report recommended that the governing bodies should take measures to control the chaos in the market. The decision of the Chinese authorities was simply to ban ICOs.
Some people still thought this was only a temporary precautionary measure while awaiting new methods of controlling the momentum of the market. But the Chinese authorities’ aversion to cryptocurrencies, whose frenzied evolution has dizzying highs and lows, will lead to yet another restrictive measure.
Last October 23, BTCChina, China’s largest bitcoin trading platform announced that all transactions around this cryptocurrency would be completed by October 30th. However, some are still optimistic and hope to see cryptocurrencies back on the Chinese market legally. This decision of the authorities prohibits the trade of Bitcoin, but not its possession.
Bitcoin China: Will the Ban Change its Course?
Before the government’s interventionist measures, China alone accounted for more than 80% of global Bitcoin trade. All these restrictions are based on Chinese leaders speculating that this crypto-currency will soon crash. And that it will be sure to go out with a BOOM.
For Pan Gonsheng, vice-governor of the People Bank of China, Bitcoin is at the stage where the flame burns very hot, right before going out. At a financial forum in Shanghai last week, the vice governor said that bitcoin will start sinking very soon and at that moment, it will be better to be on the sidelines rather than in the middle of the crypto chaos.
It is, however, surprising to see that despite these restrictive measures, the interest of Chinese investors for this asset has not declined at all. Quite contrary to this, the volume of transactions has increased by approximately 144% since the ban. But the Chinese central bank does not seem worried about this situation. For Pan Gonsheng, he thinks this momentum will fade on its own; Bitcoin is sure to disappear.