Topic: BTC China Endgame??? (Read 604 times)

My post from another recent thread.  Of course it is just my opinion:

I think it's wishful thinking to think China will recover.  I think it is game over in China.  I currently live and work here and it is very clear how the government operates. 

First, they seemed open and friendly to Bitcoin.  A tactic only, while behind the scenes they viewed it as a threat and tried to determine how to move against it.

Second, they released a vague and general statement through the PBOC banning financial institutions from involvement in Bitcoin, while still stating individuals are free to own it.  Again, on the surface appearing accepting of Bitcoin, but those that understand how government works here, reading between the lines as a warning shot to get the hell out.  My Chinese girlfriend actually read the press release and warned me in advance that Bitcoin was now being taken seriously by government.

Not long after, a secret meeting was held with payment processors to stop all funding of exchanges.  Again, moving in the direction of a complete Ban, but still leaving the door open for individuals to trade bitcoin and withdraw back to CNY.

Next step???  I believe they will set a time banning financial institutions from allowing CNY withdrawal.  The government is just corralling the herd.  Once this happens, a stampede to get money off chinese exchanges happens.  Price falls dramatically.

Result:  Bitcoin still legal to hold and trade just as the government initially had said.  However, essentially worthless for the average Chinese without a foreign bank account.

Very interesting. Thanks for the update.

My thoughts exactly. 

Of course a very small percentage of Chinese will be able to take advantage of the fallout.  Even if a a few of them are large players, however I think they will still represent a small percentage compared to BTC China at its peak.

Thus much lower prices on BTC China in the future relative to other exchanges, and lower prices on other exchanges until those with this opportunity have cashed out. 

I think this process is happening now, but won't start  ramping up until the PBOC gives some official statement, which I expect soon.

Hello. Nice to hear from someone in China.

My guess is there are going to be several people in your position that will be buying bitcoins on the cheap and then dumping them on the non-Chinese exchanges and cashing out into a non-Chinese bank account. It is a license to print money that is too good to pass up. Remember, it only takes a few rich Chinese people to buy tons of BTC on BTC China at fire sale prices and then turn around and dump them for profit on the non-Chinese exchanges. The reality has to hit most of the traders in China eventually that they will be stuck with BTC that can't be cashed out if they wait too long to sell.

That is why I think the market still has a ways to go before it bottoms out.

luqash3,  I don't believe the fate of Bitcoin is up to one single country, even though the China market represents a huge loss for Bitcoin in the near term.  Long-term, wider adoption of investors and merchants and improved Bitcoin services will result in a much robust system and of course higher prices.  Near-term, we are certainly headed for lower prices IMHO.  We just lost a huge portion of the Bitcoin market and I don't see Demand from other sources sustaining these current prices.

Thanks for your reply iPaulito.

Of course I'm not going to be the only one to speculate on that, however, as a percentage of BTC China users that can cash out in a foreign exchange, I think I'm in a unique position.  The way I see it, a majority of BTC China users are locked in RMB and very few have foreign bank accounts.  Sure they can hold Bitcoins, but what good is it selling those Bitcoins on another exchange if it is very difficult for them to get cash back to China.  The only thing they can hope for is if the government reverses it's current stance (unlikely in my opinion) OR sell Bitcoins on a Chinese exchange and cash out.

wow, you really think that way?! 

Azeh exactly china is a big power upon whom bitcoin death or prosperity depends. If china kills bitcoin in his own country then it shall die worldwide while in case china forgive bitcoin then it may open new gates of prosperity for bitcoin to achieve in a matter of short period so just watch the game carefully before investing in bitcoin 

Seems reasonable for me. You are not going to be the only one to speculate on that. But for someone as you who can lose nothing, waiting for cheap coins is a great strategy if nothing changes and china will not allow CNY deposits.

shameless bump after subject change

C'mon guys, there has got to be some speculation on this topic

Hello All,

I'm sure a few others might be in the same situation, but I'm looking for some serious thoughts about my current position.

I live and work in China and bought Bitcoins through BTC China in October. On the way down I sold my coins.  I sent a few back to Coinbase on the last huge sell-off and arbed the market. In the process I cashed out my initial investment with a nice little profit.

I currently have a nice chunk of fiat sitting on the BTC China exchange and I believe there is no way the government will allow any further funding from banks or 3rd parties to the exchanges, so my question is this:

What do you guys think will happen with the BTC China exchange?

My speculation:

When current BTC China users realize the market is not coming back in China many more will withdraw CNY from the exchange, the price will collapse to new lows as users get out of BTC and back into CNY.  Bitcoin becomes extremely cheap compared to other exchanges.  At this point I buy all I can and transfer out.

Please give me your thoughts on this scenario.

Thanks