top of page
Writer's pictureFahad H

Cryptocurrency’s Rocky Road: China’s ICO Ban

In the wake of China’s ICO ban, what befalls the world of cryptocurrencies?

The greatest occasion within the cryptocurrency world just lately was the declaration of the Chinese authorities to close down the exchanges on which cryptocurrencies are traded. As a end result, BTCChina, one of many largest bitcoin exchanges in China, mentioned that it will be ceasing buying and selling actions by the tip of September. This information catalysed a pointy sell-off that left bitcoin (and different currencies corresponding to Etherium) plummeting roughly 30% beneath the file highs that have been reached earlier this month.

So, the cryptocurrency rollercoaster continues. With bitcoin having will increase that surpass quadrupled values from December 2016 to September 2017, some analysts predict that it may possibly cryptocurrencies can get better from the latest falls. Josh Mahoney, a market analyst at IG feedback that cryptocurrencies’ “past experience tells us that [they] will likely brush these latest challenges aside”.

However, these sentiments do not come with out opposition. Mr Dimon, CEO of JPMorgan Chase, remarked that bitcoin “isn’t going to work” and that it “is a fraud… worse than tulip bulbs (in reference to the Dutch ‘tulip mania’ of the 17th century, recognised as the world’s first speculative bubble)… that will blow up“. He goes to the extent of claiming that he would fireplace workers who have been silly sufficient to commerce in bitcoin.

Speculation apart, what is definitely occurring? Since China’s ICO ban, different world-leading economies are taking a recent look into how the cryptocurrency world ought to/ could be regulated of their areas. Rather than banning ICOs, different international locations nonetheless recognise the technological advantages of crypto-technology, and are wanting into controlling the market with out fully stifling the expansion of the currencies. The large challenge for these economies is to determine how to do that, as the choice nature of the cryptocurrencies don’t enable them to be categorized underneath the insurance policies of conventional funding belongings.

Some of those international locations embody Japan, Singapore and the US. These economies search to determine accounting requirements for cryptocurrencies, primarily so as to deal with cash laundering and fraud, which have been rendered extra elusive because of the crypto-technology. Yet, most regulators do recognise that there appears to be no actual profit to fully banning cryptocurrencies because of the financial flows that they carry alongside. Also, most likely as a result of it’s virtually inconceivable to close down the crypto-world for so long as the web exists. Regulators can solely deal with areas the place they can train some management, which appears to be the place cryptocurrencies meet fiat currencies (i.e. the cryptocurrency exchanges).

While cryptocurrencies appear to return underneath extra scrutiny as time progresses, such occasions do profit some international locations like Hong Kong. Since the Chinese ICO ban, many founders of cryptocurrency tasks have been pushed from the mainland to the town. Aurelian Menant, CEO of Gatecoin, mentioned that the corporate acquired “a high number of inquiries from blockchain project founders based in the mainland” and that there was an observable surge within the variety of Chinese purchasers registering on the platform.

Looking barely additional, corporations like Nvidia have expressed positivity from the occasion. They declare that this ICO ban will solely gasoline their GPU gross sales, because the ban will seemingly improve the demand for cryptocurrency-related GPUs. With the ban, the one solution to get hold of cryptocurrencies mined with GPUs is to mine them with computing energy. As such, people seeking to get hold of cryptocurrencies in China now should get hold of extra computing energy, versus making straight purchases by way of exchanges. In essence, Nvidia’s sentiments is that this is not a downhill spiral for cryptocurrencies; in actual fact, different industries will obtain a lift as properly.

In mild of all of the commotion and debate surrounding cryptocurrencies, the mixing of the know-how into the worldwide economies appear to be materialising rapidly. Whether or not you consider in the way forward for the know-how, or assume that it’s a “fraud… that will blow up”, the cryptocurrency rollercoaster is one price your consideration.

0 views0 comments

Comentarios


bottom of page