In the wake of China’s ICO ban, what befalls the planet of cryptocurrencies?
The greatest event in the cryptocurrency world recently was the declaration of the Chinese authorities to turn off the exchanges on which cryptocurrencies are traded. As a result, BTCChina, one of the largest bitcoin exchanges in China, said that it will be ceasing trading activities by the conclusion of September. This news catalysed a sharp sell-off that left bitcoin (and other currencies such as Etherium) plummeting approximately 30% below the record highs which were reached earlier this month.
So, the cryptocurrency rollercoaster continues. With bitcoin having increases that surpass quadrupled values from December 2016 to September 2017, some analysts predict that it can cryptocurrencies can cure the recent falls. Josh Mahoney, a market analyst at IG comments that cryptocurrencies’ “past experience tells us that [they] will probably brush these latest challenges aside” ;.
However, these sentiments don’t come without opposition. Mr Dimon, CEO of JPMorgan Chase, remarked that bitcoin “isn’t planning to work” and that it “is a fraud… worse than tulip bulbs (in mention of the the Dutch ‘tulip mania’ of the 17th century, recognised as the world’s first speculative bubble)… that’ll blow up” ;.He visits the extent of saying he would fire employees have been stupid enough to trade in bitcoin.
Speculation aside, what is actually going on? Since China’s ICO ban, other world-leading economies are having a fresh consider how a cryptocurrency world should/ can be regulated in their regions. As opposed to banning ICOs, other countries still recognise the technological benefits of crypto-technology, and are looking into controlling industry without completely stifling the growth of the currencies. The big issue for these economies is to figure out how to achieve this, as the alternative nature of the cryptocurrencies do not allow them to be classified underneath the policies of traditional investment assets.
Many of these countries include Japan, Singapore and the US. CashTab Ecash These economies seek to establish accounting standards for cryptocurrencies, mainly to be able to handle money laundering and fraud, which have been rendered more elusive due to the crypto-technology. Yet, most regulators do recognise that there seems to be no real benefit to fully banning cryptocurrencies due to the economic flows that they carry along. Also, probably because it is practically impossible to turn off the crypto-world for provided that the web exists. Regulators can only give attention to areas where they may have the ability to exercise some control, which seems to be where cryptocurrencies meet fiat currencies (i.e. the cryptocurrency exchanges).
While cryptocurrencies seem in the future under more scrutiny as time progresses, such events do benefit some countries like Hong Kong. Because the Chinese ICO ban, many founders of cryptocurrency projects have already been driven from the mainland to the city. Aurelian Menant, CEO of Gatecoin, stated that the company received “a lot of inquiries from blockchain project founders situated in the mainland” and that there’s been an observable surge in the number of Chinese clients registering on the platform.
Looking slightly further, companies like Nvidia have expressed positivity from the event. They claim that ICO ban is only going to fuel their GPU sales, as the ban will probably raise the demand for cryptocurrency-related GPUs. With the ban, the only method to acquire cryptocurrencies mined with GPUs is to mine them with computing power. Therefore, individuals looking to acquire cryptocurrencies in China are in possession of to acquire more computing power, in place of making straight purchases via exchanges. Essentially, Nvidia’s sentiments is that isn’t a downhill spiral for cryptocurrencies; actually, other industries will get a boost as well.