Crypto Executives Still Confident Despite Bitcoin Exchanges Ban
Bitcoin price went down worldwide when China released the bitcoin exchanges ban in early September. BTCC, a company based in Shanghai, will be halting bitcoin trading before 30th September. Shanghai has also taken steps to ensure more and more bitcoin exchanges are suspended before that time as well.
With China tightening its hold on bitcoin services, Bitcoin and Chinese Yuan has fallen as far as $3,251, $3,362, and $3,321 on BTCC, OKCoin and Huobi. The bitcoin exchanges ban seemed fatal as bitcoin price dropped to $2,900 until the Chinese government gave OKCoin and Huobi some more time to operate. October will mark the end of the exchanges for these largest exchange companies in China, still, this move has helped bitcoin price rise up to $3,850.
The ban seems to bring about different reactions from financial regulators and analysts in China. Some explained that neither will bitcoin be banned completely nor will the ban be permanent. It is ‘expected’ that the central bank will issue a licensing program for bitcoin trading companies before allowing bitcoin exchanges once again.
Crypto executives have adopted a positive demeanor throughout the situation and believe that such regulatory activity will have little to no impact on cryptocurrency in the long term.
Rob Vigilione, ZenCash’s co-founder, said:
“Already, we’ve seen about $60 billion in value wiped from the peak earlier this month, but there is a silver lining that may be hard to see through the clouds: regulators are starting to provide some clarity, and even if new rules aren’t ideal, they’re better than the uncertainty of potentially inferior regulation … This comes after a recent regulatory ban in China of ICOs and JPMorgan’s Jamie Dimon calling bitcoin a ‘fraud’ that is set to ‘blow up … The big question is whether this shock is already internalized into asset prices, or if there’s risk of a continued cascading sell-off. One good thing about crypto markets is that they are largely equity-based, and not massively interconnected webs of leveraged derivatives with unknown counterparties, as is the norm in modern banking. The China ICO ban and the cessation of trading certainly have deep initial impact to prices, but also a much smaller marginal contribution to systemic risk than we’re used to seeing from large financial institutions, like Dimon’s JPMorgan.”
The president of China, Xi Jinping, also supports free markets and if he were to be elected once again in November, he could life the ban and allow bitcoin trading and the use of ICOs by convincing regulators and authorities.
Bharath Rao, Leverj’s CEO, said that ever since the government took note of bitcoin, they were expecting it to stop the exchanges. He further added, “The price is always a solid metric of the markets’ greed and fear, and reflects regulatory uncertainty at the moment. This also signals that development of non-custodial and decentralized models will accelerate.”
He believes cryptocurrency or any other decentralized model cannot be regulated and that it is also not essential to do so. However, this situation has motivated the community to develop “high-speed, non-custodial exchanges” which will be fruitful for cryptocurrency’s future.
Sweetbridge’s vice president in the protocol marketing department, Jason English, thinks that it is impossible to believe that China is ready to disregard cryptocurrency because it quite risky. He said, “China is practically building a cottage industry for mining and exchanging bitcoin and other cryptocurrencies, so it is hard to believe that they intend to exit a market with so much potential upside … Even the apparent ban on ICOs seemed to be more of a stopgap in order to get some policies in place. If anything, this example shows the volatility of the space and that some market makers can likely take advantage of an unclear news cycle to create a sell-off and buy back opportunity.”