Experts believe that the prohibition of cripture in China will be temporary

© RIA Novosti / Vladimir Astapkovich in fotobasketball bitcoin. Archival photoExperts believe that the prohibition of cripture in China will be temporary© RIA Novosti / Vladimir Astapkovich the image Bank

The ban of the authorities of China on the domestic stock exchange of cryptocurrency in the event of the entry will be temporary, and the trade in virtual currencies will not end, according to respondents RIA Novosti analysts.

Bank of China September 4, banned the ICO (initial placement of tokens cryptocurrency) because of the financial risks. The regulator said that ICO — unsanctioned and illegal fundraising, which can be associated with fraud and financial pyramids.

Later, according to media reports, the Chinese government has introduced a number of restrictions on trade with virtual money and threatened to close all crypto currency exchange on-site. While a formal ban on the cryptocurrency trading in Chinese exchanges is not confirmed, and the Chinese crypto currency exchange has not received notification on the suspension of trading. However, against the background of these messages has collapsed not only bitcoin, but almost all the popular cryptocurrency.

As at 16.57 GMT the price of bitcoin (BTC) exchange Bitfinex decreased by 7.94%, to 3,820 thousand dollars, and the cost of the new Bitcoin Cash fell by 9.65%, to 486,99 dollar.

Trade will not stop

As told by co-founder and CEO of cryptocurrency exchange BitMEX, Arthur Hayes (Arthur Hayes), is currently in China, there are three large trading volume of the cryptocurrency exchanges — BTCC, Huobi and OKCoin. According to him, if they will close, trade will not cease, but will simply become «black».

«Most of the trading volume accounted for the exchange’s public filings. The largest three exchanges by volume are BTCC, Huobi and OKCoin. A potential ban on stock trading bitcoin and other cryptocurrencies will lead to the fact that the trading volume will grow under the earth, through the OTC trade. This trading method is not transparent, and regulators will have less control over the industry,» he said.

«At the moment in China, we are not talking about a complete ban on the cryptocurrency, banning the cryptocurrency exchanges. This decision may be due to the desire of the Chinese authorities to strengthen control over cash flows in the country. However, this does not mean that a similar position will be taken by the regulators in other countries. The fact that now actively developing a digital infrastructure that will allow the state to keep records storage, transfer and use of digital assets, and thus bring cryptocurrency of the «gray zone», — said the founder and head Waves Platform Alexander Ivanov.

«China is an important player in the cryptocurrency market, China accounted for 80% of mining. At the same time, China accounts for only 8% nodes, while the share of Chinese exchanges trade bitcoin declined since the beginning of this year from 70% to 25%,» — said a senior analyst «Alpari» the novel Tkachuk.

According to him, the people’s Bank of China has no direct impact on the cryptocurrency market, so regulators can only once again to note the increased risk of investing in cryptocurrencies, and investors «, can proceed at your own risk.»

«Even if the ban is confirmed, then a serious impact on the exchange rate of bitcoin this will have. The only possible increased market volatility and local trading volumes decrease. Prohibitions only lead to landscape change – investors transfer cryptocurrencies to other countries and on other exchanges. Cryptocurrency exchange is electronic, so if you want, they can quickly move and change my «residence». The server can be set in any country,» — said Tkachuk.

Evaluation of technical analyst resource Brave New Coin Josh Olsevich (Josh Olszewicz), to the crypto currency exchange China accounts for 27% of global trading volume per day.

The ban will be short-lived

Experts believe that the ban on the cryptocurrency trades will be temporary. As soon as the regulation of the industry, and themselves the virtual currency will be legalized, the ban will be lifted.

«This ban will be short-lived. As soon as the national Congress will end at the end of October, cryptocurrency trading to be liberalized. In the interest of authorities not to push this trade activity «underground» where they will not be able to control it,» says Hayes.

This is also the opinion of Ivanov: «In the future the Chinese authorities, improving the mechanisms of regulation may reconsider its decision».

«China, apparently, forbids bitcoin at least once a year. This is just another form of control over the movement of capital. Perhaps they will ease the ban and impose the controls they deem necessary», — said Olszewicz.

«People’s Bank of China took a tough stance on cryptocurrencies. He probably is trying to protect investors from increased risk. But it’s unclear whether he will go by way of the ban on trade or on the way of regulating the market. The second scenario is positive for the cryptocurrency, as it will provide investors new opportunities for investment. The position of China as a major player, will be indicative for other countries. It is significant that some countries (Korea, Malaysia, India) do not rush to accept bitcoin until it becomes clear China’s position,» — said Tkachuk.


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