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Chinese Crypto Traders Find Ways To Skirt Government Crackdown

Rules Are Meant To Be Broken? 

To many in the crypto community, intense government intervention or regulation is not a problem, as a majority of nations across the globe are somewhat open to the use and propagation of crypto assets. However, as reported multiple times by Ethereum World News in the past few weeks, China-based regulators have been doing their utmost best to clamp down on the development, use, and trading of cryptocurrencies within the country’s borders.

Some of the measures the government took include, silencing crypto discussion on online forums, banning cryptocurrency-related events, restricting 124 foreign crypto exchanges, blocking access to eight crypto-centric news outlets on WeChat, and also banning Alipay accounts that have been suspected of facilitating crypto trades.

But as the old saying goes, “rules are meant to be broken.” Cryptocurrency firms and traders within the country have evidently taken this saying to heart, doing their best to skirt the bans by introducing ingenious solutions and workarounds.

As per a recent report from the South China Morning Post, despite Beijing’s attempt to shutter local exchanges, executives and employees within these firms have sought to avoid the ban by utilizing a series of domains to get their exchanges to the public via alternative means, albeit in less than ideal manner.

By moving their servers and legal operations outside of Chinese borders, these firms can essentially bypass a majority of the legal risks of propping up an exchange in China, which become classified foreign exchanges at that point. Speaking on the matter, Terence Tsang, the chief operating officer of TideBit, which maintains a series of crypto exchanges in Hong Kong and Taiwan, stated:

The latest warning and potentially increased monitoring of foreign platforms is targeted at a batch of smaller exchanges that had claimed to be foreign entities, but are in fact operating in China claiming they have outsourced their operations to a Chinese company… Those exchanges whose website landing pages are in Chinese have drawn particular scrutiny by regulators.

However, despite these updated exchange “website landing pages” drawing substantial amounts of scrutiny from regulators, industry leaders said that as long as an exchange’s server remains outside of China, that it would be a “huge challenge” for governmental bodies to stamp out all instances of cryptocurrency trades and transactions.

China’s Alternative Mode Of Crypto Trading

The South China Morning Post went on to describe how Chinese crypto investors have been trading following the ban. First prospective traders will need to find a way to purchase Tether tokens for Yuan, which can be done via exchange sites that offer Tether-to-yuan trading after the two sides of the trade submits fulfill the proper KYC requirements. The “exchange” oversees the trades, ensuring that both sides of the agreement get what they were asking for.

Sources told the SCMP that money will be transferred from bank-to-bank, or via third party payment networks, like AliPay or WeChat. Once the Tether appears in the wallet of the trader, he/she/they can trade these tokens on foreign exchanges through the use of VPNs and similar programs.

Photo by 郑 无忌 on Unsplash

The post Chinese Crypto Traders Find Ways To Skirt Government Crackdown appeared first on Ethereum World News.

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Longest Running Bitcoin Exchange Marks the End of An Era – Shuts Down

BTCC – Bitcoin exchange has terminated its CNY trading platform under declared China ICO ban regulation – leaving the industry and giving an end to its services.

BTCC made the announcement on Twitter, noting that it had operated for a “world record of 2,305 days.” Indeed, the vast majority of bitcoin users likely cannot remember a time before BTCC. Throughout the world, exchanges rose, fell, and occasionally scammed their customers, but BTCC remained.

This is not a surprise as the actions by the officials towards ICO ban has been followed with a domestic bitcoin exchanges shut down to be done with instructions by regulators. On Sep 14, BTCC announced that it will be closing down two weeks later on Sep 30, being the first to take the step. On Sep 27 BTCC did not accept anymore deposits.

Although BTCC’s operations in mainland China are winding down, the company will continue to operate elsewhere. BTCC’s USD and DAX exchanges, as well as its mining pool and other company operations, will function as normal.

Despite BTCC’s historic status, not everyone was sorry to see the exchange go. As a New York Agreement (NYA) signatory, the company had incurred the ire of a significant segment of the bitcoin community, and tensions have increased as the proposed November date for the controversial SegWit2x hard fork approaches. Consequently, some social media users gloated at the exchange’s demise. Others expressed incredulity, believing thus-far unsubstantiated rumors that regulators will eventually license domestic bitcoin exchanges and allow them to resume trading.

Nevertheless, BTCC CEO Bobby Lee took to Twitter to commemorate the end of BTCC’s record-setting run:

“We started as China’s 1st bitcoin exchange. Back then, BTC price was just CNY ¥150,” he wrote. At present exchange rates, that is just $22.60, meaning that bitcoin has appreciated by more than 19,000% in the intervening years.

“Wish we could have bought some more,” Lee added.

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Even if Bitcoin is a Bubble: More of a Reason there is for Profit to be Made

Manager that left Fortress Investment Group after a losing streak of two years is in the way of initiating a $500 million hedge fund as an investment plan in cryptocurrencies, ICO and crypto-related companies.

The investor does support two ideas that walk different paths in the minds of many: Bitcoin is a great opportunity to invest but a big upcoming bubble.

The sum of $150 million from his pocket will be invested and then top up what is left – $350 mln from family offices, wealthy individuals and fellow hedge fund managers.

The Fund (in the event it is successful) it could be the biggest of its kind, but the investor himself as mentioned above has an interesting point of view of the market development that could take:

“This is going to be the largest bubble of our lifetimes. Prices are going to get way ahead of where they should be. You can make a whole lot of money on the way up, and we plan on it.”

The latest price record swing and declining crash is the type of of market he would swim in as the investor states:

“I sold at $5,000 or $4,980,” he said. “Then three weeks later I’m trying to buy it in the low $3,000s. If you’re good at that and you’re a trading junkie, it’s a lot of fun.”

There have been lately very extremely-different opinions to read, when it comes to cryptocurrencies and trading.

JPMorgan Jamie Dimon did call bitcoin a fraud and worthless as nobody should trade it or who does should be fired. These not-enthusiastic about the ‘future technology’ are figuring out the regulation and China crackdown on bitcoin as a backup to their opinions.

On the other hand the supporters see these regulation as an opportunity to profit from while the market is restructuring:

“In a lot of ways, this is a market like any other market,” Novogratz said. “You see the psychology of fear and greed in the charts the same way you’d see it in charts of the Indonesian rupiah or dollar-yen or treasuries. They’re exaggerated because of less liquidity and because you can’t get short.”

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