Over the past year the market cryptocurrency adopted a series of hard punches from the Chinese government. The market took hits as a warrior, but the combo took its value in many investors cryptocurrency. Market performance in 2018 decreased in comparison with stellar millennial growth in 2017.
Since 2013, the Chinese government is taking measures to cryptocurrency regulation, but nothing compared to what was introduced in 2017 (see this article for a detailed analysis of the official report issued by the Chinese government)
2017 was a landmark year for the market cryptocurrency respectfully and growth that he has achieved. Extreme price instability caused's central bank to take more extreme measures, including a ban on the initial proposals of coins (ICO) and the abolition of internal exchanges cryptocurrency. Shortly mining factories in China were forced to close, citing the excessive consumption of electricity. Many exchanges and factories have moved overseas to avoid regulation, but were available for Chinese investors. However, they still can not escape the clutches of the Chinese Dragon.
In the last series of efforts led by the Government to control and prohibit trade cryptocurrency among Chinese investors, China has expanded its "Eagle Eye" for the control of foreign exchanges cryptocurrency. Companies and bank accounts suspected of transactions with foreign exchanges and crypto related activities are subject to the measures: restriction on withdrawal limits to freeze accounts. The Chinese community continues even rumors of the more extreme measures to be carried out on foreign platforms that allow you to trade among Chinese investors.
"As to whether further regulatory measures will be, we will have to wait for orders of higher authorities." Excerpts from an interview with & # 39; nd with the head of the public information security group on oversight agency of China under the Ministry of Public Security February 28
Imagine that your child is putting their savings to invest in digital product (in this case cryptocurrency) that he has no way to verify the authenticity and value. He may be lucky and get rich or lose everything if the crypto-bubble burst. Now the scale of millions of Chinese citizens, and we are talking about billions of RMB.
The market is full of scams and senseless ICO. (I'm sure you've heard the news that people send coins to random addresses, promising to double its investments and ICO, which simply do not make sense). Many investors nesavy contain money for the money and care less about technology and innovation. The value of many cryptocurrency comes from market speculation. During the boom time of encryption in 2017 participate in either ICO or with known advisor to the board, and with a promising team, or with a decent hype, and you are guaranteed a minimum 3X your investment.
Lack of understanding of the company and the technology behind it, coupled with the spread of ICO – is a recipe for disaster. Members of the Central Bank reported that almost 90% ICO with the & # 39 is a scam or involve illegal fund-raising. In my opinion, the Chinese government wants to ensure that cryptocurrency remain "controlled" and not too big to fail in the Chinese community. China has taken the right steps towards a safer and more regulated world cryptocurrency, though aggressive and controversial. In fact, this may be the best step that the country has made over the decades.
Shall issue an ultimatum to China and make cryptocurrency illegal? I doubt very much, because it is pointless to do. Currently, financial institutions are not allowed to store any crypto assets, while individuals are allowed, but forbidden to carry out any form of trade.
State Exchange cryptocurrency?
In the annual "two sessions" (named because the two main parties – the National People's Congress (NPC) and the National Committee of the Chinese People's Political Consultative Conference (KPKK)) take part in the forum, which is held in the first week of March, the leaders gathered to discuss the latest issues and make the necessary amendments to the law.
Van Penzhy, NPCC member tried to consider the prospects of the state of digital asset trading platform, as well as initiating educational projects and blokcheyne cryptocurrency in China. However, the proposed platform would require authentication to allow trade.
"In establishing the relevant regulations and cooperation of the People's Bank of China (PBoC) and the Commission on Securities Regulation in China (CSRC) adjustable and effective platform cryptocurrency exchange would serve as a formal way of fund-raising (through ICO) and investors to support their digital assets and to achieve capital increase "Excerpts presentation Wang Penzhy two sessions.
The march to the nation Blockchain
Governments and central banks around the world are struggling with the rising popularity of cryptocurrency; but one thing is sure: all covered blockchain.
Despite the crackdown cryptocurrency, blockchain gaining popularity and acceptance at various levels. The Chinese government supports the initiative blockchain and uses technology. In fact, the National Bank of China (PBoC) is working on a digital exchange and to conduct operations with some mocking the country's commercial banks. Still not confirmed that the digital currency will be decentralized and offers features such cryptocurrency as anonymity and permanence. It would not come as a surprise, if he is simply a digital Chinese yuan, given that anonymity – is the last thing China wants in his country. However, established as a close substitute the RMB, digital currency will be subject to existing monetary policy and laws.
Governor Zhou Xiaochuan of the People's of China Bank. Source: CNBC
"Many cryptocurrency seen explosive growth, which can bring significant negative impact on consumers and retail investors' We do not like (cryptocurrency) products that use a great opportunity for speculation that give people the illusion of getting rich overnight." Excerpts Interviews & # 39; Yu Zhou Xiaochuan on Friday, March 9th.
On the & # 39; yavivshysya in the media on Friday, March 9, the governor of China Governor Zhou Xiaochuan of the People's Bank criticized cryptocurrency projects benefiting from the crypto-boom, to capitalize on the market and speculation on the fuel market. He also noted that the development of digital currency "technologically inevitable"
At the regional level, in many Chinese cities are blockchain initiatives to promote growth in the region. Hangzhou, the famous Alibaba is headquartered, said blockchain technology & # 39 is one of the main priorities of the city in 2018. Local government in Chengdu has also been proposed to construct an incubation center for promoting the introduction of technology in the financial blockchain city services.
Local conglomerates such as Tencent and Alibaba, also establish partnerships with companies blockchain or initiate projects of their own. Blockchain firms such as VeChain, also provided many partnerships with Chinese firms to increase the transparency of the supply chain in China.
All the evidence points to the fact that China is working to create a flow circuit. China has always been open to the mentality of the new technologies, such as mobile payment, and artificial intelligence. Hence, no doubt, China will become the first country to support blokcheyna. Whether we Chinese Government to step back and allow its citizens to trade again? Probably, when the market has matured and become less volatile, but 2018 is definitely not.