In the wake of China’s ICO ban, what befalls the world of cryptocurrencies?
The greatest event in the cryptocurrency world recently was the declaration of the Chinese authorities to shut down the exchanges where cryptocurrencies are traded. As a result, BTCChina, one of the largest bitcoin exchanges in China, said so it could be ceasing trading activities by the finish 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 that have been 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 so 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 more than likely brush these latest challenges aside” ;.
However, these sentiments don’t come without opposition. Mr Dimon, CEO of JPMorgan Chase, remarked that bitcoin “isn’t going to work” and so it “is a fraud… worse than tulip bulbs (in mention of the Dutch ‘tulip mania’ of the 17th century, recognised since the world’s first speculative bubble)… that will blow up” ;.He would go to the extent of saying he would fire employees who 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 taking a fresh explore how a cryptocurrency world should/ could be regulated within their regions. crypto signals Rather than banning ICOs, other countries still recognise the technological benefits of crypto-technology, and are considering controlling industry without completely stifling the growth of the currencies. The major problem for these economies is always to figure out how to achieve this, as the choice nature of the cryptocurrencies don’t allow them to be classified beneath the policies of traditional investment assets.
Several of those countries include Japan, Singapore and the US. These economies seek to ascertain accounting standards for cryptocurrencies, mainly to be able to handle money laundering and fraud, that have been rendered more elusive due to the crypto-technology. Yet, most regulators do recognise that there is apparently no real benefit to totally banning cryptocurrencies due to the economic flows that they carry along. Also, probably because it’s practically impossible to shut down the crypto-world for provided that the web exists. Regulators can only focus on areas where they may manage to exercise some control, which is apparently where cryptocurrencies meet fiat currencies (i.e. the cryptocurrency exchanges).
While cryptocurrencies seem to come 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, said that the business received “a large number of inquiries from blockchain project founders situated in the mainland” and that there has 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 this ICO ban will simply fuel their GPU sales, since the ban will more than likely increase the demand for cryptocurrency-related GPUs. With the ban, the only method to obtain cryptocurrencies mined with GPUs is always to mine them with computing power. As such, individuals looking to obtain cryptocurrencies in China are in possession of to obtain more computing power, as opposed to making straight purchases via exchanges. Basically, Nvidia’s sentiments is that this isn’t a downhill spiral for cryptocurrencies; actually, other industries will receive a boost as well.