Governing bodies from around the world are uncertain of the potential of the cryptocurrency market and are acting cautiously.
Towards the end of 2017, we saw the Peoples Bank of China (one of the largest Chinese banks) ban ICO’s and domestic trading platforms. This could have been a massive blow to cryptocurrencies and their trading systems, as a large portion of Bitcoin and altcoin traders are in China (See the statistics here).
However, the truth couldn’t have been more different.
In a matter of months, Chinese based cryptocurrency networks and trading platforms have grown twofold. The two largest in question, Huobi and OKCoin, started implementing systems to ensure their growth/survival. Their primary method was to expand westerly to the more relaxed cryptocurrency markets in America. The result would be a larger and more diverse user base for these platforms.
Another strategy employed by Huobi was to offer a reward for its existing users. The HT token was released and handed out for free to Huobi’s loyal traders. This new cryptocurrency has value but is primarily to be used in a voting system. Users can utilise the HT token to vote for which cryptocurrencies they would like to be added to Huobi’s trading systems. This is just another amazing implementation of a blockchain system offering a valuable service. There are many new cryptocurrencies popping up every day, so by allowing users to trade whichever digital coins they want to, it attracts more users to Huobi.
Of course, many cryptocurrency investors were scared that they would lose a lot of value if they maintained their presence in the Chinese markets, and so they flocked to the west. Binance, a western cryptocurrency exchange saw massive growth after the Chinese ban. Just after a few months of its release, Binance is now one of the largest of its kind. It’s apparent that that without the ban, Binance would simply not be doing as well.
Governing bodies between China and the US put regulations in place to stop foreign traders from participating in respective domestic cryptocurrency markets. However, most Crypto users simply bypassed these regulations using Virtual private networks (VPNs).
It’s not uncommon for resistance to a system to cause adaption, and the China ban scenario is a prime example of that. A lack of cryptocurrency opportunities in the east only resulted in a rise of them in the west. It’s clear that Bitcoin and digital currency aren’t going out anytime soon.
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