Topic: [2017-09-25] Forbes: Why China's Ban On Bitcoin May Be Temporary (Read 5742 times)

China didn't ban bitcoin and altcoins. They banned ICOs. I think if so much ICOs wouldn't be use for money washing and scam - anything like that would not happen.
Probably those things that are happening in China are just strong politic about regulation inside the country. The same they did with the Internet, as I know many international sites just not available there.

If we agree that Bitcoin markets are full of insider trading and that most events get priced in before they become known to the public, that just by looking at current price one can deduce that some bullish news might be coming soon, as the price very quickly rebounded from the drop caused by China. Legalization and regulation of exchanges seem to make sense, as China has a very strong position because of miners and miner manufacturers and it would be a waste to ban Bitcoin - instead they can try to monitor and control it by controlling exchanges.

Why should the people suffer because of the government's actions? This ban isn't bringing anything good to the table. Traders can't trade, exchange owners can't run their businesses, the government will get less tax revenue. Nobody wins in this situation. As for manipulations, don't forget that China has lead us to our first $1000 ath. They know how to dump and are very twitchy, but they also know how to pump.

Well, just my two cents. I think the ban may be temporary in the sense that the market volatility will dictate the terms of how the Chinese government will go about the existence of BTC. But then again, China is the ultimate economy nowadays that it can variably dictate on how the market works. We must remember how strong China's economy is. It can affect both high and low-income generating economies because majority of States depend on China for goods, labor, and etc. Thus, we have to await on the changing circumstances.   

The ban in China on holding ICO and on circulation of crypto currency in the country can not really be long. Whether this is due to the upcoming October 19-th Party Conference of China will show the time. However, after this party conference, the political leadership of the country will change and prohibitions can be lifted by the new leadership. In any case, the ban on circulation of crypto-currency is an illogical move by the government and therefore can not hold out for long.

I do not understand why Chinese should prohibit cryptocurrencies. Nearly 50% of global capacity for the mining of the coins is concentrated in China. They are investments which have great growth prospects. Who would abandon the gold Creek? It seems to me that all these rumors are fake.

Nah, this is something that won't happen. If they end up banning Bitcoin entirely, they will never have the same level of control in comparison to when they are heavily regulating the crypto market. China is just buying time in order to get their 'business' done where they will implement far stricter regulations. All information about every satoshi or penny that people deposit in their account will directly be played to the Chinese government - this to grant the government every bit of information about whatever individual, and that's exactly what they are looking for. If we look at how the market responds to every announcement coming from China, then it's safe to say that the problem isn't China itself, but all the people falling for it - no one is forcing you to sell your coins like there is no tomorrow. People think that China is the main country in this market, and that's something they have to let go. Let China do whatever it want, why do we need to drag the entire market down just because of that? It doesn't make sense.

China illegal initial coin offerings (ICOs) earlier in the week in a very move to stop concealment and prohibited activities.
ICOs enable organizations to lift investment by commercialism new cryptocurrencies, that square measure kind of like bitcoin.
China’s forbiddance of initial coin offerings for brand new digital currencies could stop scams and improve the market however these ICOs square measure considerably here to remain.

ICOs enable organizations to lift investment by commercialism new cryptocurrencies, kind of like bitcoin, reciprocally for money or different established digital currencies. However, the People’s Bank of China dominated earlier in the week that the apply, that has become standard round the world, similarly as in China, constitutes prohibited fundraising.

Around $1.78 billion has been raised through ICOs since 2014, in line with knowledge from the CoinDesk ICO hunter. However, a serious issue is that several ICOs can be scams, with no hope of backers receiving a come on their investment.

“There’s no secret that plenty of the initial coin offerings, with ads on Facebook promising vast discounts and returns, square measure nothing however a scam,” aforementioned Sasha Ivanov, corporate executive of [Suspicious link removed]pany Waves, in associate degree email.

“The Chinese government might deal with those firms operating in a very shadow zone of the law, however they need finally lost patience, as additional and additional firms tried to lift millions for nothing.”

Ivanov says the move are useful for the business, and predicts that regulated ICOs are allowed in China within the future.

One company littered with the ban is on-line disposal platform Blackmoon Crypto. It recently raised over $9 million in associate degree ICO pre-sale. the corporate has currently halted its planned promotional activity inside China. it’ll additionally disallow Chinese voters half|participating|collaborating} in its token sale on Sept twelve and can refund voters UN agency took part within the pre-sale.

“Blackmoon Crypto can still take terribly seriously all initiatives of worldwide regulators and can suits the upheld necessities. As knowledgeable within the business, we tend to welcome the cleansing of the market from scrupulous participants and square measure able to collaborate with regulators,” aforementioned the company’s corporate executive Oleg Seydak in associate degree email.

The purpose of ICOs

Part of the matter regulators could have is that ICOs cowl a good vary of activities, in line with Linus Lindgren, strategic capitalist and adviser at BTCXIndia.

“One facet of the spectrum would be to sell components of future revenue of an organization via issued tokens to investors UN agency look to invest within the worth of such tokens. the opposite facet of the spectrum can be charities provision ‘thank you’ tokens in exchange for donations. In between, there square measure many sorts and mixes of those,” he told CNBC via email on weekday.

“The discussion to be had now’s wherever on the ‘token spectrum’ regulators can draw the road, and wherever and the way these activities ought to be regulated.”

The move by China received mixed reactions. Cryptocurrencies fell on the move because it created negative market sentiment. Bitcoin hit a coffee of $4,037 on Tues however has recovered to around $4,500 on weekday.

Some, like David Moskowitz, co-founder and corporate executive of blockchain-powered social network Indorse, welcome the move as the way to shield customers from fallacious ICOs.

“We hope the authorities can acknowledge the potential of the world for economic process and technological development, and enact rules which can afford the safe and secure way forward for the business,” he aforementioned in associate degree press statement.

Others were additional skeptical, citing that the ban could lead on to competition with different countries that square measure additional hospitable for ICOs.

“Some governments and incumbents can try and finish off this movement, and are available to unreasonable extremes so as to try and do therefore. However, due to the web and cryptography, there is not any going back,” aforementioned Luis Cuende, co-founder and project lead at blockchain developer Aragon, in associate degree email.

“Eventually, another governments can embrace token sales and crypto normally, making territorial competition, and forcing the incumbents to be affordable.”

The Chinese government is doing this, because they are closing loopholes that are being used for capital flight. They know uncontrolled capital flight will hurt their economy, so they first banned ICO's and when they saw that it did not stop capital flight, they started to ban Bitcoin too.

They want 100% control and Bitcoin does not allow for that to happen. We should be glad to be rid of them, they are too unstable for the growth of this technology.

If China stops to manipulate the market, then some kind of arcing country will do it. This is a regularity. Where there will be the largest number of miners, from there will come the manipulation

I hope they will ban forever, this way, they will be out of crypto-currency forever and can't control bitcoin prices.

The information is too general and not specific to draw its conclusions. It is possible that all of these prohibitions in China are related to the forthcoming party conference and soon all prohibitions will be removed and China, as before, will again return to the crypto currency market, which it almost lost.

The Communist party in China has to maintain their iron grip on capital.  Hence the capital controls on both Chinese citizens and foreign companies doing business there.  Similarly, the need to have the "Great Firewall of China" in order to control the internet to control what the people of China hear, read, and see.

Whatever flavor of authoritarianism they are embracing, it has at root the need to control the people.  Whatever China has, it doesn't have freedom and the rule of law.  Bitcoin allows people to escape that control both for transactions inside China and transactions to and from China.  It allows the average Chinese person to escape the devaluation of the Yuan and protect their wealth, no matter the size.  If a large enough number of people realize this and bitcoin continues to have a foothold in China, it will be yet another point of pressure on the rulers.

What the Chinese people need to realize is that they don't need exchanges.  They can just hold and use bitcoin without ever having to exchange most of it back to fiat.  They can use it to pay for services, goods etc.  All the while bypassing their authoritarian rulers and helping to preserve their wealth.

I'm not sure what world people are living in to still believe that China is a communist nation.  They literally support private property in their Constitution, saying:
The trading volume has risen because people are now trading frantically with the intention of leaving their exchanges before they close down.  This is not ordinary trading volume.

Even at current rates, it's not enough to have a particularly significant effect on their economy.

Yep! These old-school commentators really need to catch up with the times. China is not that slow, overbearing Communist regime the West would still like to think it is. This was not a knee-jerk reaction, but a swift series of events that just caught the market by surprise. The broad and over-arching capital outflow reasoning is far more rational, even if that alone is unlikely to be the sole mover.

Also, if 2017's Bitcoin (should we say crypto, though?) economy isn't a threat, this doesn't explain similar reactions from the Chinese administration as far back as 2014.

Things won't return to the way they were for sure, but whatever new environment China wants its economies to operate in will be the new normal.

I don't think that this is the very reason to shutdown ICO and closed its local exchanges. Its more deep rooted as I speculate. Its probably that bitcoin has really threatening Yuan and they have to do something about it. I don't think that they just want to appease the Communist Politburo.


I have to disagree with this. Bitcoin economy is booming in China. You could look at the sheer number of trading volumes per 24 hours, so its not that small to really not affect their economy. They need to move fast to stop all of this before its too late.

Well, let's see if this just just a temporary in nature and they will made a U-turn to let everything back to normal once more. But I seriously doubt though. We already withstand the test of not having China at our back so its better be like that.

China's ban on Bitcoin and other cryptocurrencies may be temporary, to appease international agencies and hardcore communist members ahead of the upcoming Communist Party convention.

China's big government and banks cannot tolerate Bitcoin. It threatens their very existence, as it was previously written in a piece here.

That's in the long term, though, when Bitcoin has the potential to replace the yuan in everyday transactions, and as a monetary asset.

At present and in the immediate future, however, the size of the Bitcoin economy is far too small to be a real threat to the Beijing government and the banking system it owns and manages.

That’s why something else must be at play behind the Bitcoin ban. Like an effort by Beijing to demonstrate to international agencies, such as S&P Global, that it is in good control of the financial system and the credit conditions of the country.

If that was their aim, it didn't work. S&P Global downgraded China one notch last week.

Then there's the upcoming 19th Communist Party Convention, where the party leadership will be grilled by hardcore members on any innovation that threatens the party’s grip on the economy.

Actually, this isn't the first time Beijing is going after innovations that threaten that. Back in 2011, a few months before the 18th Communist Party Convention, the party leadership at that time went after a controversial Chinese corporate structure, Variable Interest Entity (VIE). This structure had allowed Chinese companies to list their shares in US exchanges through “reverse mergers”—a strategy that drew the scrutiny of US regulators, due to a string of accounting irregularities among these companies.

Read more: https://www.forbes.com/sites/panosmourdoukoutas/2017/09/25/why-chinas-ban-on-bitcoin-may-be-temporary/#435ed0577929