Over the past year, the cryptocurrency marketplace has taken a series of heavy punches from the Chinese authorities. The marketplace took the hits like a warrior, but the mixtures have taken their toll on many cryptocurrency investors. The market’s lackluster overall performance in 2018 pales in comparison to its stellar thousand-percent profits in 2017.
What has happened?
Since 2013, the Chinese authorities have taken measures to regulate cryptocurrency. However, nothing compared to what turned into enforced in 2017. (Check out this text for a detailed evaluation of the professional note issued by way of the Chinese authorities) 2017 turned into a banner year for the cryptocurrency marketplace with all the eye and growth it has finished. The excessive charge volatility pressured the Central financial institution to undertake more extreme measures, such as the ban on initial coin offerings (ICOs) and clampdowns on home cryptocurrency exchanges. Soon after, mining factories in China were pressured to close down, bringing up immoderate power consumption. Many exchanges and factories have relocated to remote places to avoid rules. However, they remained handy to Chinese investors. Nonetheless, they fail to escape the claws of the Chinese Dragon.
In today’s government-led efforts to monitor and ban cryptocurrency trading among Chinese buyers, China prolonged its “Eagle Eye” to reveal overseas cryptocurrency exchanges. Companies and financial institution debts suspected of sporting out transactions with foreign crypto exchanges and related sports are subjected to limiting withdrawal limits to freezing bills. There have even been rumors among the various Chinese communities of greater excessive measures enforced on overseas systems that permit trading among Chinese traders. “As for whether there can be additional regulatory measures, we must watch for orders from the higher authorities.” Excerpts from an interview with the group chief of China’s Public Information Network Security Supervision employer under the Ministry of Public Security, twenty-eighth February
WHY, WHY, WHY!?
Imagine your child investing their savings in a virtual product (in this situation, cryptocurrency) that they cannot verify its authenticity and fee. They should get fortunate and strike it wealthy or lose all of it while the crypto-bubble bursts. Now, scale that to tens of millions of Chinese citizens, and we are talking about billions of Chinese Yuan.
The marketplace is complete with scams and unnecessary ICOs. (I’m certain you’ve heard the news of people sending cash to random addresses with the promise of doubling their investments and ICOs that genuinely do not make feel). Many unsavvy buyers are in it for the money and would care less approximately the technology and innovation in the back of it. The price of many cryptocurrencies is derived from the marketplace hypothesis. During the crypto-boom in 2017, participate in an ICO with a well-known advisor onboard, a promising group, or decent hype, and you are guaranteed at least 3X your investments.
A lack of information about the company and the generation behind it blended with the proliferation of CIOs, is a recipe for catastrophe. Central Bank members report that nearly ninety ICOs are fraudulent or entail unlawful fundraising. I think the Chinese government wants to ensure that cryptocurrency stays ‘controllable’ and is not too big to fail in the Chinese network. Although competitive and controversial, China is taking the right steps towards a more secure, extra-regulated international cryptocurrency. It is probably the nice flow. S. A. Has taken in decades.
Will China issue an ultimatum and make cryptocurrency unlawful? I fantastically doubt so, as it would be pretty pointless to accomplish that. Currently, monetary institutions are banned from keeping any crypto belongings even as individuals are allowed to; however, they are barred from engaging in any trading.
